Correlation Between Broadstone Net and Global Net
Can any of the company-specific risk be diversified away by investing in both Broadstone Net 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 Broadstone Net and Global Net 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 Global Net Lease,, you can compare the effects of market volatilities on Broadstone Net 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 Broadstone Net with a short position of Global Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of Broadstone Net and Global Net.
Diversification Opportunities for Broadstone Net and Global Net
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Broadstone and Global is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Broadstone Net Lease 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 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 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 Broadstone Net i.e., Broadstone Net and Global Net go up and down completely randomly.
Pair Corralation between Broadstone Net and Global Net
Considering the 90-day investment horizon Broadstone Net is expected to generate 1.08 times less return on investment than Global Net. But when comparing it to its historical volatility, Broadstone Net Lease is 1.33 times less risky than Global Net. It trades about 0.06 of its potential returns per unit of risk. Global Net Lease, is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 710.00 in Global Net Lease, on November 9, 2024 and sell it today you would earn a total of 11.00 from holding Global Net Lease, or generate 1.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Broadstone Net Lease vs. Global Net Lease,
Performance |
| Timeline |
| Broadstone Net Lease |
| Global Net Lease, |
Broadstone Net and Global Net Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Broadstone Net and Global Net
The main advantage of trading using opposite Broadstone Net and Global Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Broadstone Net 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.| Broadstone Net vs. Armada Hflr Pr | Broadstone Net vs. Brightspire Capital | Broadstone Net vs. Safehold | Broadstone Net vs. Essential Properties Realty |
| Global Net vs. Peakstone Realty Trust | Global Net vs. Gladstone Commercial | Global Net vs. CTO Realty Growth | Global Net vs. Brightspire Capital |
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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