Correlation Between Broadstone Net and Pacer Financial
Can any of the company-specific risk be diversified away by investing in both Broadstone Net and Pacer Financial 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 Pacer Financial 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 Pacer Financial, you can compare the effects of market volatilities on Broadstone Net and Pacer Financial 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 Pacer Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Broadstone Net and Pacer Financial.
Diversification Opportunities for Broadstone Net and Pacer Financial
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Broadstone and Pacer is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Broadstone Net Lease and Pacer Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pacer Financial 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 Pacer Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pacer Financial has no effect on the direction of Broadstone Net i.e., Broadstone Net and Pacer Financial go up and down completely randomly.
Pair Corralation between Broadstone Net and Pacer Financial
Considering the 90-day investment horizon Broadstone Net is expected to generate 7.79 times less return on investment than Pacer Financial. But when comparing it to its historical volatility, Broadstone Net Lease is 1.52 times less risky than Pacer Financial. It trades about 0.04 of its potential returns per unit of risk. Pacer Financial is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 633.00 in Pacer Financial on August 27, 2024 and sell it today you would earn a total of 107.00 from holding Pacer Financial or generate 16.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 9.38% |
| Values | Daily Returns |
Broadstone Net Lease vs. Pacer Financial
Performance |
| Timeline |
| Broadstone Net Lease |
| Pacer Financial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Broadstone Net and Pacer Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Broadstone Net and Pacer Financial
The main advantage of trading using opposite Broadstone Net and Pacer Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Broadstone Net position performs unexpectedly, Pacer Financial 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 Pacer Financial will offset losses from the drop in Pacer Financial's long position.| Broadstone Net vs. Armada Hflr Pr | Broadstone Net vs. Brightspire Capital | Broadstone Net vs. Safehold | Broadstone Net vs. Essential Properties Realty |
| Pacer Financial vs. Vanguard Real Estate | Pacer Financial vs. Howard Hughes | Pacer Financial vs. Site Centers Corp |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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