Correlation Between Brandywine Realty and Zhihu
Can any of the company-specific risk be diversified away by investing in both Brandywine Realty and Zhihu 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 Zhihu 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 Zhihu Inc ADR, you can compare the effects of market volatilities on Brandywine Realty and Zhihu 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 Zhihu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brandywine Realty and Zhihu.
Diversification Opportunities for Brandywine Realty and Zhihu
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Brandywine and Zhihu is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Brandywine Realty Trust and Zhihu Inc ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhihu Inc ADR 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 Zhihu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhihu Inc ADR has no effect on the direction of Brandywine Realty i.e., Brandywine Realty and Zhihu go up and down completely randomly.
Pair Corralation between Brandywine Realty and Zhihu
Considering the 90-day investment horizon Brandywine Realty Trust is expected to generate 0.67 times more return on investment than Zhihu. However, Brandywine Realty Trust is 1.49 times less risky than Zhihu. It trades about 0.08 of its potential returns per unit of risk. Zhihu Inc ADR is currently generating about -0.03 per unit of risk. If you would invest 335.00 in Brandywine Realty Trust on August 25, 2024 and sell it today you would earn a total of 219.00 from holding Brandywine Realty Trust or generate 65.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.63% |
| Values | Daily Returns |
Brandywine Realty Trust vs. Zhihu Inc ADR
Performance |
| Timeline |
| Brandywine Realty Trust |
| Zhihu Inc ADR |
Brandywine Realty and Zhihu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brandywine Realty and Zhihu
The main advantage of trading using opposite Brandywine Realty and Zhihu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brandywine Realty position performs unexpectedly, Zhihu 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 Zhihu will offset losses from the drop in Zhihu's long position.| Brandywine Realty vs. Boston Properties | Brandywine Realty vs. Alexandria Real Estate | Brandywine Realty vs. Vornado Realty Trust | Brandywine Realty vs. Highwoods Properties |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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