Correlation Between CITY OFFICE and Superior Plus
Can any of the company-specific risk be diversified away by investing in both CITY OFFICE and Superior Plus 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 CITY OFFICE and Superior Plus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CITY OFFICE REIT and Superior Plus Corp, you can compare the effects of market volatilities on CITY OFFICE and Superior Plus 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 CITY OFFICE with a short position of Superior Plus. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITY OFFICE and Superior Plus.
Diversification Opportunities for CITY OFFICE and Superior Plus
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CITY and Superior is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding CITY OFFICE REIT and Superior Plus Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Superior Plus Corp and CITY 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 CITY OFFICE REIT are associated (or correlated) with Superior Plus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Superior Plus Corp has no effect on the direction of CITY OFFICE i.e., CITY OFFICE and Superior Plus go up and down completely randomly.
Pair Corralation between CITY OFFICE and Superior Plus
Assuming the 90 days horizon CITY OFFICE REIT is expected to generate 0.79 times more return on investment than Superior Plus. However, CITY OFFICE REIT is 1.26 times less risky than Superior Plus. It trades about 0.1 of its potential returns per unit of risk. Superior Plus Corp is currently generating about -0.02 per unit of risk. If you would invest 480.00 in CITY OFFICE REIT on September 13, 2024 and sell it today you would earn a total of 55.00 from holding CITY OFFICE REIT or generate 11.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CITY OFFICE REIT vs. Superior Plus Corp
Performance |
| Timeline |
| CITY OFFICE REIT |
| Superior Plus Corp |
CITY OFFICE and Superior Plus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CITY OFFICE and Superior Plus
The main advantage of trading using opposite CITY OFFICE and Superior Plus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITY OFFICE position performs unexpectedly, Superior Plus 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 Superior Plus will offset losses from the drop in Superior Plus' long position.| CITY OFFICE vs. Office Properties Income | CITY OFFICE vs. CREMECOMTRSBI DL 001 | CITY OFFICE vs. Superior Plus Corp | CITY OFFICE vs. SIVERS SEMICONDUCTORS AB |
| Superior Plus vs. HF SINCLAIR P | Superior Plus vs. PT Indofood Sukses | Superior Plus vs. SENECA FOODS A | Superior Plus vs. ScanSource |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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