Correlation Between Golden Energy and Simon Property
Can any of the company-specific risk be diversified away by investing in both Golden Energy and Simon Property 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 Golden Energy and Simon Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Golden Energy Offshore and Simon Property Group, you can compare the effects of market volatilities on Golden Energy and Simon Property 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 Golden Energy with a short position of Simon Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Energy and Simon Property.
Diversification Opportunities for Golden Energy and Simon Property
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Golden and Simon is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Golden Energy Offshore and Simon Property Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simon Property Group and Golden Energy 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 Golden Energy Offshore are associated (or correlated) with Simon Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simon Property Group has no effect on the direction of Golden Energy i.e., Golden Energy and Simon Property go up and down completely randomly.
Pair Corralation between Golden Energy and Simon Property
Assuming the 90 days horizon Golden Energy Offshore is expected to generate 99.14 times more return on investment than Simon Property. However, Golden Energy is 99.14 times more volatile than Simon Property Group. It trades about 0.13 of its potential returns per unit of risk. Simon Property Group is currently generating about 0.04 per unit of risk. If you would invest 14.00 in Golden Energy Offshore on March 7, 2024 and sell it today you would earn a total of 316.00 from holding Golden Energy Offshore or generate 2257.14% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Golden Energy Offshore vs. Simon Property Group
Performance |
Timeline |
Golden Energy Offshore |
Simon Property Group |
Golden Energy and Simon Property Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Golden Energy and Simon Property
The main advantage of trading using opposite Golden Energy and Simon Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Energy position performs unexpectedly, Simon Property 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 Simon Property will offset losses from the drop in Simon Property's long position.Golden Energy vs. Hapag Lloyd Aktiengesellschaft | Golden Energy vs. Hapag Lloyd Aktiengesellschaft | Golden Energy vs. AP Moeller Maersk AS | Golden Energy vs. AP Mller |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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