Correlation Between Brandywine Realty and Global Net

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Brandywine Realty 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 Brandywine Realty and Global Net 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 Global Net Lease, you can compare the effects of market volatilities on Brandywine Realty 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 Brandywine Realty with a short position of Global Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brandywine Realty and Global Net.

Diversification Opportunities for Brandywine Realty and Global Net

0.68
  Correlation Coefficient

Poor diversification

The 3 months correlation between Brandywine and Global is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Brandywine Realty Trust 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 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 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 Brandywine Realty i.e., Brandywine Realty and Global Net go up and down completely randomly.

Pair Corralation between Brandywine Realty and Global Net

Considering the 90-day investment horizon Brandywine Realty Trust is expected to generate 2.05 times more return on investment than Global Net. However, Brandywine Realty is 2.05 times more volatile than Global Net Lease. It trades about 0.26 of its potential returns per unit of risk. Global Net Lease is currently generating about 0.23 per unit of risk. If you would invest  508.00  in Brandywine Realty Trust on September 2, 2024 and sell it today you would earn a total of  52.00  from holding Brandywine Realty Trust or generate 10.24% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Brandywine Realty Trust  vs.  Global Net Lease

 Performance 
       Timeline  
Brandywine Realty Trust 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Brandywine Realty Trust are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent fundamental indicators, Brandywine Realty displayed solid returns over the last few months and may actually be approaching a breakup point.
Global Net Lease 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Global Net Lease are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile essential indicators, Global Net may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Brandywine Realty and Global Net Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Brandywine Realty and Global Net

The main advantage of trading using opposite Brandywine Realty and Global Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brandywine Realty 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.
The idea behind Brandywine Realty Trust and Global Net Lease pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.

Other Complementary Tools

Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
Portfolio Dashboard
Portfolio dashboard that provides centralized access to all your investments
Odds Of Bankruptcy
Get analysis of equity chance of financial distress in the next 2 years
AI Portfolio Architect
Use AI to generate optimal portfolios and find profitable investment opportunities
Sectors
List of equity sectors categorizing publicly traded companies based on their primary business activities