Correlation Between Brandywine Realty and Freedom Bank
Can any of the company-specific risk be diversified away by investing in both Brandywine Realty and Freedom Bank 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 Brandywine Realty and Freedom Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brandywine Realty Trust and Freedom Bank of, you can compare the effects of market volatilities on Brandywine Realty and Freedom Bank 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 Brandywine Realty with a short position of Freedom Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brandywine Realty and Freedom Bank.
Diversification Opportunities for Brandywine Realty and Freedom Bank
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Brandywine and Freedom is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Brandywine Realty Trust and Freedom Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freedom Bank and Brandywine Realty 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 Brandywine Realty Trust are associated (or correlated) with Freedom Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freedom Bank has no effect on the direction of Brandywine Realty i.e., Brandywine Realty and Freedom Bank go up and down completely randomly.
Pair Corralation between Brandywine Realty and Freedom Bank
Considering the 90-day investment horizon Brandywine Realty Trust is expected to under-perform the Freedom Bank. In addition to that, Brandywine Realty is 3.3 times more volatile than Freedom Bank of. It trades about -0.27 of its total potential returns per unit of risk. Freedom Bank of is currently generating about 0.11 per unit of volatility. If you would invest 1,035 in Freedom Bank of on November 27, 2024 and sell it today you would earn a total of 15.00 from holding Freedom Bank of or generate 1.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brandywine Realty Trust vs. Freedom Bank of
Performance |
| Timeline |
| Brandywine Realty Trust |
| Freedom Bank |
Brandywine Realty and Freedom Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brandywine Realty and Freedom Bank
The main advantage of trading using opposite Brandywine Realty and Freedom Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brandywine Realty position performs unexpectedly, Freedom Bank 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 Freedom Bank will offset losses from the drop in Freedom Bank's long position.| Brandywine Realty vs. Douglas Emmett | Brandywine Realty vs. Kilroy Realty Corp | Brandywine Realty vs. Piedmont Office Realty | Brandywine Realty vs. City Office |
| Freedom Bank vs. National Capital Bank | Freedom Bank vs. Community Heritage Financial | Freedom Bank vs. Citizens Financial Corp | Freedom Bank vs. Bank of Idaho |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
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