Correlation Between Boston Properties and CREMECOMTRSBI
Can any of the company-specific risk be diversified away by investing in both Boston Properties and CREMECOMTRSBI 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 Boston Properties and CREMECOMTRSBI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Properties and CREMECOMTRSBI DL 001, you can compare the effects of market volatilities on Boston Properties and CREMECOMTRSBI 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 Boston Properties with a short position of CREMECOMTRSBI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Properties and CREMECOMTRSBI.
Diversification Opportunities for Boston Properties and CREMECOMTRSBI
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Boston and CREMECOMTRSBI is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Boston Properties and CREMECOMTRSBI DL 001 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CREMECOMTRSBI DL 001 and Boston Properties 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 Boston Properties are associated (or correlated) with CREMECOMTRSBI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CREMECOMTRSBI DL 001 has no effect on the direction of Boston Properties i.e., Boston Properties and CREMECOMTRSBI go up and down completely randomly.
Pair Corralation between Boston Properties and CREMECOMTRSBI
Assuming the 90 days horizon Boston Properties is expected to under-perform the CREMECOMTRSBI. But the stock apears to be less risky and, when comparing its historical volatility, Boston Properties is 7.65 times less risky than CREMECOMTRSBI. The stock trades about -0.03 of its potential returns per unit of risk. The CREMECOMTRSBI DL 001 is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 116.00 in CREMECOMTRSBI DL 001 on October 24, 2024 and sell it today you would earn a total of 54.00 from holding CREMECOMTRSBI DL 001 or generate 46.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.12% |
| Values | Daily Returns |
Boston Properties vs. CREMECOMTRSBI DL 001
Performance |
| Timeline |
| Boston Properties |
| CREMECOMTRSBI DL 001 |
Boston Properties and CREMECOMTRSBI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Properties and CREMECOMTRSBI
The main advantage of trading using opposite Boston Properties and CREMECOMTRSBI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Properties position performs unexpectedly, CREMECOMTRSBI 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 CREMECOMTRSBI will offset losses from the drop in CREMECOMTRSBI's long position.| Boston Properties vs. QINGCI GAMES INC | Boston Properties vs. Nomad Foods | Boston Properties vs. Austevoll Seafood ASA | Boston Properties vs. TreeHouse Foods |
| CREMECOMTRSBI vs. Sunny Optical Technology | CREMECOMTRSBI vs. CHINA SOUTHN AIR H | CREMECOMTRSBI vs. RYANAIR HLDGS ADR | CREMECOMTRSBI vs. Pentair plc |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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