Correlation Between American Assets and Global Net
Can any of the company-specific risk be diversified away by investing in both American Assets and Global Net 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 American Assets and Global Net into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Assets Trust and Global Net Lease,, you can compare the effects of market volatilities on American Assets and Global Net 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 American Assets with a short position of Global Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Assets and Global Net.
Diversification Opportunities for American Assets and Global Net
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between American and Global is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding American Assets Trust and Global Net Lease, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Net Lease, and American Assets 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 American Assets Trust are associated (or correlated) with Global Net. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Net Lease, has no effect on the direction of American Assets i.e., American Assets and Global Net go up and down completely randomly.
Pair Corralation between American Assets and Global Net
Considering the 90-day investment horizon American Assets Trust is expected to under-perform the Global Net. In addition to that, American Assets is 1.59 times more volatile than Global Net Lease,. It trades about -0.3 of its total potential returns per unit of risk. Global Net Lease, is currently generating about -0.06 per unit of volatility. If you would invest 738.00 in Global Net Lease, on November 27, 2024 and sell it today you would lose (12.00) from holding Global Net Lease, or give up 1.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Assets Trust vs. Global Net Lease,
Performance |
| Timeline |
| American Assets Trust |
| Global Net Lease, |
American Assets and Global Net Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Assets and Global Net
The main advantage of trading using opposite American Assets and Global Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Assets position performs unexpectedly, Global Net 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 Global Net will offset losses from the drop in Global Net's long position.| American Assets vs. Essential Properties Realty | American Assets vs. Armada Hflr Pr | American Assets vs. CTO Realty Growth | American Assets vs. Brightspire Capital |
| Global Net vs. Peakstone Realty Trust | Global Net vs. Gladstone Commercial | Global Net vs. CTO Realty Growth | Global Net vs. Brightspire Capital |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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