Correlation Between Bread Financial and Prologis
Can any of the company-specific risk be diversified away by investing in both Bread Financial and Prologis 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 Bread Financial and Prologis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bread Financial Holdings and Prologis, you can compare the effects of market volatilities on Bread Financial and Prologis 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 Bread Financial with a short position of Prologis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bread Financial and Prologis.
Diversification Opportunities for Bread Financial and Prologis
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bread and Prologis is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Bread Financial Holdings and Prologis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prologis and Bread Financial 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 Bread Financial Holdings are associated (or correlated) with Prologis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prologis has no effect on the direction of Bread Financial i.e., Bread Financial and Prologis go up and down completely randomly.
Pair Corralation between Bread Financial and Prologis
Assuming the 90 days trading horizon Bread Financial Holdings is expected to generate 0.98 times more return on investment than Prologis. However, Bread Financial Holdings is 1.02 times less risky than Prologis. It trades about 0.64 of its potential returns per unit of risk. Prologis is currently generating about 0.04 per unit of risk. If you would invest 8,160 in Bread Financial Holdings on September 14, 2024 and sell it today you would earn a total of 1,710 from holding Bread Financial Holdings or generate 20.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bread Financial Holdings vs. Prologis
Performance |
| Timeline |
| Bread Financial Holdings |
| Prologis |
Bread Financial and Prologis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bread Financial and Prologis
The main advantage of trading using opposite Bread Financial and Prologis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bread Financial position performs unexpectedly, Prologis 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 Prologis will offset losses from the drop in Prologis' long position.| Bread Financial vs. Beyond Meat | Bread Financial vs. Zoom Video Communications | Bread Financial vs. Autohome | Bread Financial vs. STMicroelectronics NV |
| Prologis vs. Mitsubishi UFJ Financial | Prologis vs. Bread Financial Holdings | Prologis vs. Cognizant Technology Solutions | Prologis vs. SVB Financial Group |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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