Correlation Between Centuria Industrial and GreenX Metals

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

By analyzing existing cross correlation between Centuria Industrial Reit and GreenX Metals, you can compare the effects of market volatilities on Centuria Industrial and GreenX Metals 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 Centuria Industrial with a short position of GreenX Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centuria Industrial and GreenX Metals.

Diversification Opportunities for Centuria Industrial and GreenX Metals

0.33

Correlation Coefficient

Centuria Industrial  GreenX Metals

Weak diversification

The 3 months correlation between Centuria and GreenX is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Centuria Industrial Reit and GreenX Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GreenX Metals and Centuria Industrial 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 Centuria Industrial Reit are associated (or correlated) with GreenX Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GreenX Metals has no effect on the direction of Centuria Industrial i.e., Centuria Industrial and GreenX Metals go up and down completely randomly.

Pair Corralation between Centuria Industrial and GreenX Metals

Assuming the 90 days trading horizon Centuria Industrial is expected to generate 4.85 times less return on investment than GreenX Metals. But when comparing it to its historical volatility, Centuria Industrial Reit is 1.87 times less risky than GreenX Metals. It trades about 0.06 of its potential returns per unit of risk. GreenX Metals is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  65.00  in GreenX Metals on December 4, 2024 and sell it today you would earn a total of  12.00  from holding GreenX Metals or generate 18.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Centuria Industrial Reit  vs.  GreenX Metals

Centuria Industrial Reit

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Centuria Industrial Reit are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Centuria Industrial is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

GreenX Metals

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in GreenX Metals are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, GreenX Metals unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Centuria Industrial and GreenX Metals

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

The idea behind Centuria Industrial Reit and GreenX Metals 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.