Correlation Between Aegon NV and JBG SMITH
Can any of the company-specific risk be diversified away by investing in both Aegon NV and JBG SMITH 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 Aegon NV and JBG SMITH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aegon NV ADR and JBG SMITH Properties, you can compare the effects of market volatilities on Aegon NV and JBG SMITH 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 Aegon NV with a short position of JBG SMITH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegon NV and JBG SMITH.
Diversification Opportunities for Aegon NV and JBG SMITH
Very good diversification
The 3 months correlation between Aegon and JBG is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Aegon NV ADR and JBG SMITH Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JBG SMITH Properties and Aegon NV 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 Aegon NV ADR are associated (or correlated) with JBG SMITH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JBG SMITH Properties has no effect on the direction of Aegon NV i.e., Aegon NV and JBG SMITH go up and down completely randomly.
Pair Corralation between Aegon NV and JBG SMITH
Considering the 90-day investment horizon Aegon NV ADR is expected to under-perform the JBG SMITH. But the stock apears to be less risky and, when comparing its historical volatility, Aegon NV ADR is 1.59 times less risky than JBG SMITH. The stock trades about -0.1 of its potential returns per unit of risk. The JBG SMITH Properties is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 1,670 in JBG SMITH Properties on September 12, 2024 and sell it today you would lose (35.00) from holding JBG SMITH Properties or give up 2.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aegon NV ADR vs. JBG SMITH Properties
Performance |
| Timeline |
| Aegon NV ADR |
| JBG SMITH Properties |
Aegon NV and JBG SMITH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegon NV and JBG SMITH
The main advantage of trading using opposite Aegon NV and JBG SMITH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegon NV position performs unexpectedly, JBG SMITH 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 JBG SMITH will offset losses from the drop in JBG SMITH's long position.| Aegon NV vs. Hartford Financial Services | Aegon NV vs. Goosehead Insurance | Aegon NV vs. International General Insurance | Aegon NV vs. Enstar Group Limited |
| JBG SMITH vs. Highwoods Properties | JBG SMITH vs. Douglas Emmett | JBG SMITH vs. Equity Commonwealth | JBG SMITH vs. Kilroy Realty Corp |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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