Correlation Between Broadstone Net and Armada Hoffler
Can any of the company-specific risk be diversified away by investing in both Broadstone Net and Armada Hoffler 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 Broadstone Net and Armada Hoffler into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Broadstone Net Lease and Armada Hoffler Properties, you can compare the effects of market volatilities on Broadstone Net and Armada Hoffler 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 Broadstone Net with a short position of Armada Hoffler. Check out your portfolio center. Please also check ongoing floating volatility patterns of Broadstone Net and Armada Hoffler.
Diversification Opportunities for Broadstone Net and Armada Hoffler
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Broadstone and Armada is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Broadstone Net Lease and Armada Hoffler Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Armada Hoffler Properties and Broadstone Net 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 Broadstone Net Lease are associated (or correlated) with Armada Hoffler. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Armada Hoffler Properties has no effect on the direction of Broadstone Net i.e., Broadstone Net and Armada Hoffler go up and down completely randomly.
Pair Corralation between Broadstone Net and Armada Hoffler
Considering the 90-day investment horizon Broadstone Net Lease is expected to generate 1.3 times more return on investment than Armada Hoffler. However, Broadstone Net is 1.3 times more volatile than Armada Hoffler Properties. It trades about 0.01 of its potential returns per unit of risk. Armada Hoffler Properties is currently generating about 0.0 per unit of risk. If you would invest 1,573 in Broadstone Net Lease on November 9, 2024 and sell it today you would earn a total of 7.00 from holding Broadstone Net Lease or generate 0.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Broadstone Net Lease vs. Armada Hoffler Properties
Performance |
| Timeline |
| Broadstone Net Lease |
| Armada Hoffler Properties |
Broadstone Net and Armada Hoffler Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Broadstone Net and Armada Hoffler
The main advantage of trading using opposite Broadstone Net and Armada Hoffler positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Broadstone Net position performs unexpectedly, Armada Hoffler 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 Armada Hoffler will offset losses from the drop in Armada Hoffler's long position.| Broadstone Net vs. Armada Hflr Pr | Broadstone Net vs. Brightspire Capital | Broadstone Net vs. Safehold | Broadstone Net vs. Essential Properties Realty |
| Armada Hoffler vs. Artis REIT | Armada Hoffler vs. Ascott Residence Trust | Armada Hoffler vs. Armada Hflr Pr |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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