Correlation Between Armada Hflr and Global Net
Can any of the company-specific risk be diversified away by investing in both Armada Hflr 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 Armada Hflr and Global Net into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Armada Hflr Pr and Global Net Lease, you can compare the effects of market volatilities on Armada Hflr 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 Armada Hflr with a short position of Global Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and Global Net.
Diversification Opportunities for Armada Hflr and Global Net
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Armada and Global is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr 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 Armada Hflr 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 Armada Hflr Pr 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 Armada Hflr i.e., Armada Hflr and Global Net go up and down completely randomly.
Pair Corralation between Armada Hflr and Global Net
Considering the 90-day investment horizon Armada Hflr Pr is expected to under-perform the Global Net. In addition to that, Armada Hflr is 1.01 times more volatile than Global Net Lease. It trades about -0.11 of its total potential returns per unit of risk. Global Net Lease is currently generating about -0.08 per unit of volatility. If you would invest 2,219 in Global Net Lease on October 26, 2024 and sell it today you would lose (155.00) from holding Global Net Lease or give up 6.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Armada Hflr Pr vs. Global Net Lease
Performance |
| Timeline |
| Armada Hflr Pr |
| Global Net Lease |
Armada Hflr and Global Net Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Armada Hflr and Global Net
The main advantage of trading using opposite Armada Hflr and Global Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Armada Hflr 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.| Armada Hflr vs. Modiv Inc | Armada Hflr vs. Precinct Properties New | Armada Hflr vs. Global Net Lease | Armada Hflr vs. NexPoint Diversified Real |
| Global Net vs. Global Net Lease | Global Net vs. Global Medical REIT | Global Net vs. City Office REIT | Global Net vs. ARMOUR Residential REIT |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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