Correlation Between Bright Kindle and VistaREIT
Can any of the company-specific risk be diversified away by investing in both Bright Kindle and VistaREIT 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 Bright Kindle and VistaREIT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bright Kindle Resources and VistaREIT, you can compare the effects of market volatilities on Bright Kindle and VistaREIT 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 Bright Kindle with a short position of VistaREIT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bright Kindle and VistaREIT.
Diversification Opportunities for Bright Kindle and VistaREIT
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bright and VistaREIT is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Bright Kindle Resources and VistaREIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VistaREIT and Bright Kindle 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 Bright Kindle Resources are associated (or correlated) with VistaREIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VistaREIT has no effect on the direction of Bright Kindle i.e., Bright Kindle and VistaREIT go up and down completely randomly.
Pair Corralation between Bright Kindle and VistaREIT
Assuming the 90 days trading horizon Bright Kindle Resources is expected to under-perform the VistaREIT. In addition to that, Bright Kindle is 3.84 times more volatile than VistaREIT. It trades about -0.23 of its total potential returns per unit of risk. VistaREIT is currently generating about 0.07 per unit of volatility. If you would invest 177.00 in VistaREIT on September 1, 2024 and sell it today you would earn a total of 2.00 from holding VistaREIT or generate 1.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 85.71% |
| Values | Daily Returns |
Bright Kindle Resources vs. VistaREIT
Performance |
| Timeline |
| Bright Kindle Resources |
| VistaREIT |
Bright Kindle and VistaREIT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bright Kindle and VistaREIT
The main advantage of trading using opposite Bright Kindle and VistaREIT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bright Kindle position performs unexpectedly, VistaREIT 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 VistaREIT will offset losses from the drop in VistaREIT's long position.| Bright Kindle vs. Allhome Corp | Bright Kindle vs. LFM Properties Corp | Bright Kindle vs. Altus Property Ventures | Bright Kindle vs. Monde Nissin Corp |
| VistaREIT vs. Bright Kindle Resources | VistaREIT vs. Allhome Corp | VistaREIT vs. LFM Properties Corp | VistaREIT vs. Altus Property Ventures |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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