Correlation Between Topbuild Corp and Getty Realty
Can any of the company-specific risk be diversified away by investing in both Topbuild Corp and Getty Realty 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 Topbuild Corp and Getty Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Topbuild Corp and Getty Realty, you can compare the effects of market volatilities on Topbuild Corp and Getty Realty 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 Topbuild Corp with a short position of Getty Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Topbuild Corp and Getty Realty.
Diversification Opportunities for Topbuild Corp and Getty Realty
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Topbuild and Getty is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Topbuild Corp and Getty Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Getty Realty and Topbuild Corp 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 Topbuild Corp are associated (or correlated) with Getty Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Getty Realty has no effect on the direction of Topbuild Corp i.e., Topbuild Corp and Getty Realty go up and down completely randomly.
Pair Corralation between Topbuild Corp and Getty Realty
Considering the 90-day investment horizon Topbuild Corp is expected to generate 2.53 times more return on investment than Getty Realty. However, Topbuild Corp is 2.53 times more volatile than Getty Realty. It trades about 0.17 of its potential returns per unit of risk. Getty Realty is currently generating about 0.19 per unit of risk. If you would invest 35,373 in Topbuild Corp on September 2, 2024 and sell it today you would earn a total of 3,691 from holding Topbuild Corp or generate 10.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Topbuild Corp vs. Getty Realty
Performance |
| Timeline |
| Topbuild Corp |
| Getty Realty |
Topbuild Corp and Getty Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Topbuild Corp and Getty Realty
The main advantage of trading using opposite Topbuild Corp and Getty Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Topbuild Corp position performs unexpectedly, Getty Realty 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 Getty Realty will offset losses from the drop in Getty Realty's long position.| Topbuild Corp vs. Api Group Corp | Topbuild Corp vs. MYR Group | Topbuild Corp vs. Comfort Systems USA | Topbuild Corp vs. Construction Partners |
| Getty Realty vs. Federal Realty Investment | Getty Realty vs. National Retail Properties | Getty Realty vs. Kimco Realty |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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