Correlation Between Alstria Office and Blackstone Loan

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Can any of the company-specific risk be diversified away by investing in both Alstria Office and Blackstone Loan 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 Blackstone Loan 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 Blackstone Loan Financing, you can compare the effects of market volatilities on Alstria Office and Blackstone Loan 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 Blackstone Loan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alstria Office and Blackstone Loan.

Diversification Opportunities for Alstria Office and Blackstone Loan

0.86
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Alstria and Blackstone is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding alstria office REIT AG and Blackstone Loan Financing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackstone Loan Financing 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 Blackstone Loan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackstone Loan Financing has no effect on the direction of Alstria Office i.e., Alstria Office and Blackstone Loan go up and down completely randomly.

Pair Corralation between Alstria Office and Blackstone Loan

Assuming the 90 days trading horizon alstria office REIT AG is expected to generate 4.83 times more return on investment than Blackstone Loan. However, Alstria Office is 4.83 times more volatile than Blackstone Loan Financing. It trades about 0.25 of its potential returns per unit of risk. Blackstone Loan Financing is currently generating about -0.22 per unit of risk. If you would invest  700.00  in alstria office REIT AG on September 24, 2024 and sell it today you would earn a total of  61.00  from holding alstria office REIT AG or generate 8.71% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

alstria office REIT AG  vs.  Blackstone Loan Financing

 Performance 
       Timeline  
alstria office REIT 

Risk-Adjusted Performance

17 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in alstria office REIT AG are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite quite unsteady essential indicators, Alstria Office disclosed solid returns over the last few months and may actually be approaching a breakup point.
Blackstone Loan Financing 

Risk-Adjusted Performance

12 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Blackstone Loan Financing are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Blackstone Loan may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Alstria Office and Blackstone Loan Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Alstria Office and Blackstone Loan

The main advantage of trading using opposite Alstria Office and Blackstone Loan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alstria Office position performs unexpectedly, Blackstone Loan 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 Blackstone Loan will offset losses from the drop in Blackstone Loan's long position.
The idea behind alstria office REIT AG and Blackstone Loan Financing 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.

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