Correlation Between INVITATION HOMES and Dis Fastigheter
Can any of the company-specific risk be diversified away by investing in both INVITATION HOMES and Dis Fastigheter 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 INVITATION HOMES and Dis Fastigheter into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INVITATION HOMES DL and Dis Fastigheter AB, you can compare the effects of market volatilities on INVITATION HOMES and Dis Fastigheter 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 INVITATION HOMES with a short position of Dis Fastigheter. Check out your portfolio center. Please also check ongoing floating volatility patterns of INVITATION HOMES and Dis Fastigheter.
Diversification Opportunities for INVITATION HOMES and Dis Fastigheter
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between INVITATION and Dis is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding INVITATION HOMES DL and Dis Fastigheter AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dis Fastigheter AB and INVITATION HOMES 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 INVITATION HOMES DL are associated (or correlated) with Dis Fastigheter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dis Fastigheter AB has no effect on the direction of INVITATION HOMES i.e., INVITATION HOMES and Dis Fastigheter go up and down completely randomly.
Pair Corralation between INVITATION HOMES and Dis Fastigheter
Assuming the 90 days horizon INVITATION HOMES DL is expected to generate 0.85 times more return on investment than Dis Fastigheter. However, INVITATION HOMES DL is 1.18 times less risky than Dis Fastigheter. It trades about -0.15 of its potential returns per unit of risk. Dis Fastigheter AB is currently generating about -0.13 per unit of risk. If you would invest 3,080 in INVITATION HOMES DL on October 25, 2024 and sell it today you would lose (100.00) from holding INVITATION HOMES DL or give up 3.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
INVITATION HOMES DL vs. Dis Fastigheter AB
Performance |
| Timeline |
| INVITATION HOMES |
| Dis Fastigheter AB |
INVITATION HOMES and Dis Fastigheter Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INVITATION HOMES and Dis Fastigheter
The main advantage of trading using opposite INVITATION HOMES and Dis Fastigheter positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INVITATION HOMES position performs unexpectedly, Dis Fastigheter 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 Dis Fastigheter will offset losses from the drop in Dis Fastigheter's long position.| INVITATION HOMES vs. Mid America Apartment Communities | INVITATION HOMES vs. American Homes 4 | INVITATION HOMES vs. Superior Plus Corp | INVITATION HOMES vs. Origin Agritech |
| Dis Fastigheter vs. GAZTRTECHNIUADR15EO01 | Dis Fastigheter vs. Lamar Advertising | Dis Fastigheter vs. MUTUIONLINE | Dis Fastigheter vs. AAC TECHNOLOGHLDGADR |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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