Correlation Between Alstria Office and Universal Health
Can any of the company-specific risk be diversified away by investing in both Alstria Office and Universal Health 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 Alstria Office and Universal Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between alstria office REIT AG and Universal Health Services, you can compare the effects of market volatilities on Alstria Office and Universal Health 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 Alstria Office with a short position of Universal Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alstria Office and Universal Health.
Diversification Opportunities for Alstria Office and Universal Health
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Alstria and Universal is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding alstria office REIT AG and Universal Health Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Health Services and Alstria Office 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 alstria office REIT AG are associated (or correlated) with Universal Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Health Services has no effect on the direction of Alstria Office i.e., Alstria Office and Universal Health go up and down completely randomly.
Pair Corralation between Alstria Office and Universal Health
Assuming the 90 days trading horizon alstria office REIT AG is expected to generate 1.18 times more return on investment than Universal Health. However, Alstria Office is 1.18 times more volatile than Universal Health Services. It trades about 0.33 of its potential returns per unit of risk. Universal Health Services is currently generating about -0.43 per unit of risk. If you would invest 691.00 in alstria office REIT AG on September 28, 2024 and sell it today you would earn a total of 76.00 from holding alstria office REIT AG or generate 11.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
alstria office REIT AG vs. Universal Health Services
Performance |
| Timeline |
| alstria office REIT |
| Universal Health Services |
Alstria Office and Universal Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alstria Office and Universal Health
The main advantage of trading using opposite Alstria Office and Universal Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alstria Office position performs unexpectedly, Universal Health 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 Universal Health will offset losses from the drop in Universal Health's long position.| Alstria Office vs. Universal Health Services | Alstria Office vs. Inspiration Healthcare Group | Alstria Office vs. Omega Healthcare Investors | Alstria Office vs. Abingdon Health Plc |
| Universal Health vs. Uniper SE | Universal Health vs. Mulberry Group PLC | Universal Health vs. London Security Plc | Universal Health vs. Triad Group PLC |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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