Correlation Between Super Retail and Austral Gold
Can any of the company-specific risk be diversified away by investing in both Super Retail and Austral Gold at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Super Retail and Austral Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Super Retail Group and Austral Gold, you can compare the effects of market volatilities on Super Retail and Austral Gold and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Super Retail with a short position of Austral Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Super Retail and Austral Gold.
Diversification Opportunities for Super Retail and Austral Gold
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Super and Austral is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Super Retail Group and Austral Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Austral Gold and Super Retail is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Super Retail Group are associated (or correlated) with Austral Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Austral Gold has no effect on the direction of Super Retail i.e., Super Retail and Austral Gold go up and down completely randomly.
Pair Corralation between Super Retail and Austral Gold
Assuming the 90 days trading horizon Super Retail Group is expected to generate 0.28 times more return on investment than Austral Gold. However, Super Retail Group is 3.59 times less risky than Austral Gold. It trades about 0.04 of its potential returns per unit of risk. Austral Gold is currently generating about 0.0 per unit of risk. If you would invest 1,169 in Super Retail Group on August 31, 2024 and sell it today you would earn a total of 312.00 from holding Super Retail Group or generate 26.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.75% |
| Values | Daily Returns |
Super Retail Group vs. Austral Gold
Performance |
| Timeline |
| Super Retail Group |
| Austral Gold |
Super Retail and Austral Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Super Retail and Austral Gold
The main advantage of trading using opposite Super Retail and Austral Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Super Retail position performs unexpectedly, Austral Gold can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Austral Gold will offset losses from the drop in Austral Gold's long position.| Super Retail vs. Aneka Tambang Tbk | Super Retail vs. Unibail Rodamco Westfield SE | Super Retail vs. Macquarie Group | Super Retail vs. Commonwealth Bank |
| Austral Gold vs. BTC Health Limited | Austral Gold vs. Super Retail Group | Austral Gold vs. My Foodie Box | Austral Gold vs. Oceania Healthcare |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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