Correlation Between Aegon NV and Postal Realty
Can any of the company-specific risk be diversified away by investing in both Aegon NV and Postal Realty 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 Postal Realty 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 Postal Realty Trust, you can compare the effects of market volatilities on Aegon NV and Postal Realty 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 Postal Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegon NV and Postal Realty.
Diversification Opportunities for Aegon NV and Postal Realty
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Aegon and Postal is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Aegon NV ADR and Postal Realty Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Postal Realty Trust 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 Postal Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Postal Realty Trust has no effect on the direction of Aegon NV i.e., Aegon NV and Postal Realty go up and down completely randomly.
Pair Corralation between Aegon NV and Postal Realty
Considering the 90-day investment horizon Aegon NV is expected to generate 2.02 times less return on investment than Postal Realty. In addition to that, Aegon NV is 1.54 times more volatile than Postal Realty Trust. It trades about 0.02 of its total potential returns per unit of risk. Postal Realty Trust is currently generating about 0.07 per unit of volatility. If you would invest 1,300 in Postal Realty Trust on August 30, 2024 and sell it today you would earn a total of 112.00 from holding Postal Realty Trust or generate 8.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aegon NV ADR vs. Postal Realty Trust
Performance |
| Timeline |
| Aegon NV ADR |
| Postal Realty Trust |
Aegon NV and Postal Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegon NV and Postal Realty
The main advantage of trading using opposite Aegon NV and Postal Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegon NV position performs unexpectedly, Postal Realty 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 Postal Realty will offset losses from the drop in Postal Realty'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 |
| Postal Realty vs. Office Properties Income | Postal Realty vs. Boston Properties | Postal Realty vs. SL Green Realty | Postal Realty vs. Alexandria Real Estate |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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