Correlation Between Ascendas India and Veris Residential
Can any of the company-specific risk be diversified away by investing in both Ascendas India and Veris Residential 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 Ascendas India and Veris Residential into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ascendas India Trust and Veris Residential, you can compare the effects of market volatilities on Ascendas India and Veris Residential 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 Ascendas India with a short position of Veris Residential. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ascendas India and Veris Residential.
Diversification Opportunities for Ascendas India and Veris Residential
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ascendas and Veris is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Ascendas India Trust and Veris Residential in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Veris Residential and Ascendas India 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 Ascendas India Trust are associated (or correlated) with Veris Residential. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Veris Residential has no effect on the direction of Ascendas India i.e., Ascendas India and Veris Residential go up and down completely randomly.
Pair Corralation between Ascendas India and Veris Residential
Assuming the 90 days horizon Ascendas India Trust is expected to under-perform the Veris Residential. In addition to that, Ascendas India is 2.7 times more volatile than Veris Residential. It trades about -0.02 of its total potential returns per unit of risk. Veris Residential is currently generating about 0.15 per unit of volatility. If you would invest 1,585 in Veris Residential on December 6, 2024 and sell it today you would earn a total of 68.00 from holding Veris Residential or generate 4.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ascendas India Trust vs. Veris Residential
Performance |
| Timeline |
| Ascendas India Trust |
| Veris Residential |
Ascendas India and Veris Residential Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ascendas India and Veris Residential
The main advantage of trading using opposite Ascendas India and Veris Residential positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ascendas India position performs unexpectedly, Veris Residential 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 Veris Residential will offset losses from the drop in Veris Residential's long position.| Ascendas India vs. Asia Pptys | Ascendas India vs. Aztec Land Comb | Ascendas India vs. Ambase Corp | Ascendas India vs. Bridgemarq Real Estate |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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