Correlation Between China Gold and Brookfield Office
Can any of the company-specific risk be diversified away by investing in both China Gold and Brookfield Office 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 China Gold and Brookfield Office into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Gold International and Brookfield Office Properties, you can compare the effects of market volatilities on China Gold and Brookfield Office 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 China Gold with a short position of Brookfield Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Gold and Brookfield Office.
Diversification Opportunities for China Gold and Brookfield Office
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Brookfield is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding China Gold International and Brookfield Office Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brookfield Office and China Gold 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 China Gold International are associated (or correlated) with Brookfield Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brookfield Office has no effect on the direction of China Gold i.e., China Gold and Brookfield Office go up and down completely randomly.
Pair Corralation between China Gold and Brookfield Office
Assuming the 90 days trading horizon China Gold International is expected to generate 4.06 times more return on investment than Brookfield Office. However, China Gold is 4.06 times more volatile than Brookfield Office Properties. It trades about 0.09 of its potential returns per unit of risk. Brookfield Office Properties is currently generating about 0.15 per unit of risk. If you would invest 2,299 in China Gold International on September 1, 2025 and sell it today you would earn a total of 415.00 from holding China Gold International or generate 18.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Gold International vs. Brookfield Office Properties
Performance |
| Timeline |
| China Gold International |
| Brookfield Office |
China Gold and Brookfield Office Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Gold and Brookfield Office
The main advantage of trading using opposite China Gold and Brookfield Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Gold position performs unexpectedly, Brookfield Office 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 Brookfield Office will offset losses from the drop in Brookfield Office's long position.| China Gold vs. Black Iron | China Gold vs. Labrador Iron Ore | China Gold vs. Precious Metals And | China Gold vs. Algoma Steel Group |
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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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