Correlation Between Alstria Office and Corporate Office
Can any of the company-specific risk be diversified away by investing in both Alstria Office and Corporate Office 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 Alstria Office and Corporate Office into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between alstria office REIT AG and Corporate Office Properties, you can compare the effects of market volatilities on Alstria Office and Corporate Office 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 Alstria Office with a short position of Corporate Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alstria Office and Corporate Office.
Diversification Opportunities for Alstria Office and Corporate Office
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alstria and Corporate is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding alstria office REIT AG and Corporate Office Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corporate Office Pro and Alstria Office 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 alstria office REIT AG are associated (or correlated) with Corporate Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corporate Office Pro has no effect on the direction of Alstria Office i.e., Alstria Office and Corporate Office go up and down completely randomly.
Pair Corralation between Alstria Office and Corporate Office
Assuming the 90 days horizon alstria office REIT AG is expected to generate 2.86 times more return on investment than Corporate Office. However, Alstria Office is 2.86 times more volatile than Corporate Office Properties. It trades about 0.06 of its potential returns per unit of risk. Corporate Office Properties is currently generating about 0.09 per unit of risk. If you would invest 337.00 in alstria office REIT AG on October 16, 2024 and sell it today you would earn a total of 197.00 from holding alstria office REIT AG or generate 58.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
alstria office REIT AG vs. Corporate Office Properties
Performance |
| Timeline |
| alstria office REIT |
| Corporate Office Pro |
Alstria Office and Corporate Office Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alstria Office and Corporate Office
The main advantage of trading using opposite Alstria Office and Corporate Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alstria Office position performs unexpectedly, Corporate Office 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 Corporate Office will offset losses from the drop in Corporate Office's long position.| Alstria Office vs. United Airlines Holdings | Alstria Office vs. BJs Restaurants | Alstria Office vs. MOVIE GAMES SA | Alstria Office vs. Aegean Airlines SA |
| Corporate Office vs. CVW CLEANTECH INC | Corporate Office vs. Cleanaway Waste Management | Corporate Office vs. NORTHEAST UTILITIES | Corporate Office vs. Micron Technology |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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