Correlation Between Super Retail and Carlton Investments
Can any of the company-specific risk be diversified away by investing in both Super Retail and Carlton Investments 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 Carlton Investments 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 Carlton Investments, you can compare the effects of market volatilities on Super Retail and Carlton Investments 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 Carlton Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Super Retail and Carlton Investments.
Diversification Opportunities for Super Retail and Carlton Investments
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Super and Carlton is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Super Retail Group and Carlton Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlton Investments 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 Carlton Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlton Investments has no effect on the direction of Super Retail i.e., Super Retail and Carlton Investments go up and down completely randomly.
Pair Corralation between Super Retail and Carlton Investments
Assuming the 90 days trading horizon Super Retail is expected to generate 1.16 times less return on investment than Carlton Investments. In addition to that, Super Retail is 2.12 times more volatile than Carlton Investments. It trades about 0.03 of its total potential returns per unit of risk. Carlton Investments is currently generating about 0.07 per unit of volatility. If you would invest 2,647 in Carlton Investments on August 25, 2024 and sell it today you would earn a total of 418.00 from holding Carlton Investments or generate 15.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Super Retail Group vs. Carlton Investments
Performance |
| Timeline |
| Super Retail Group |
| Carlton Investments |
Super Retail and Carlton Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Super Retail and Carlton Investments
The main advantage of trading using opposite Super Retail and Carlton Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Super Retail position performs unexpectedly, Carlton Investments 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 Carlton Investments will offset losses from the drop in Carlton Investments' long position.| Super Retail vs. REGAL ASIAN INVESTMENTS | Super Retail vs. Qbe Insurance Group | Super Retail vs. Wt Financial Group | Super Retail vs. Kkr Credit Income |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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