Correlation Between CITY OFFICE and Stewart Information
Can any of the company-specific risk be diversified away by investing in both CITY OFFICE and Stewart Information 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 Stewart Information 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 Stewart Information Services, you can compare the effects of market volatilities on CITY OFFICE and Stewart Information 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 Stewart Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITY OFFICE and Stewart Information.
Diversification Opportunities for CITY OFFICE and Stewart Information
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CITY and Stewart is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding CITY OFFICE REIT and Stewart Information Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stewart Information 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 Stewart Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stewart Information has no effect on the direction of CITY OFFICE i.e., CITY OFFICE and Stewart Information go up and down completely randomly.
Pair Corralation between CITY OFFICE and Stewart Information
Assuming the 90 days horizon CITY OFFICE is expected to generate 1.21 times less return on investment than Stewart Information. In addition to that, CITY OFFICE is 1.75 times more volatile than Stewart Information Services. It trades about 0.03 of its total potential returns per unit of risk. Stewart Information Services is currently generating about 0.07 per unit of volatility. If you would invest 5,756 in Stewart Information Services on August 25, 2024 and sell it today you would earn a total of 894.00 from holding Stewart Information Services or generate 15.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CITY OFFICE REIT vs. Stewart Information Services
Performance |
| Timeline |
| CITY OFFICE REIT |
| Stewart Information |
CITY OFFICE and Stewart Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CITY OFFICE and Stewart Information
The main advantage of trading using opposite CITY OFFICE and Stewart Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITY OFFICE position performs unexpectedly, Stewart Information 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 Stewart Information will offset losses from the drop in Stewart Information's long position.| CITY OFFICE vs. COUSINS PTIES INC | CITY OFFICE vs. Office Properties Income | CITY OFFICE vs. CREMECOMTRSBI DL 001 |
| Stewart Information vs. QBE Insurance Group | Stewart Information vs. Insurance Australia Group | Stewart Information vs. Superior Plus Corp | Stewart Information vs. NMI Holdings |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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