Correlation Between Hafnia and Duke Realty

Can any of the company-specific risk be diversified away by investing in both Hafnia and Duke Realty 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 Hafnia and Duke Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hafnia Limited and Duke Realty, you can compare the effects of market volatilities on Hafnia and Duke Realty 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 Hafnia with a short position of Duke Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hafnia and Duke Realty.

Diversification Opportunities for Hafnia and Duke Realty

-0.58

Correlation Coefficient

Hafnia  Duke Realty

Excellent diversification

The 3 months correlation between Hafnia and Duke is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Hafnia Limited and Duke Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duke Realty and Hafnia 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 Hafnia Limited are associated (or correlated) with Duke Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duke Realty has no effect on the direction of Hafnia i.e., Hafnia and Duke Realty go up and down completely randomly.

Pair Corralation between Hafnia and Duke Realty

If you would invest  765.00  in Hafnia Limited on March 2, 2024 and sell it today you would earn a total of  130.00  from holding Hafnia Limited or generate 16.99% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	4.55%
Values	Daily Returns

Hafnia Limited  vs.  Duke Realty

Hafnia Limited

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Hafnia Limited are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of very weak technical and fundamental indicators, Hafnia displayed solid returns over the last few months and may actually be approaching a breakup point.

Duke Realty

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Duke Realty has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Duke Realty is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Hafnia and Duke Realty

The main advantage of trading using opposite Hafnia and Duke Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hafnia position performs unexpectedly, Duke Realty 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 Duke Realty will offset losses from the drop in Duke Realty's long position.

The idea behind Hafnia Limited and Duke Realty pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.