Correlation Between Boston Properties and TFI International
Can any of the company-specific risk be diversified away by investing in both Boston Properties and TFI International 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 TFI International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Properties and TFI International, you can compare the effects of market volatilities on Boston Properties and TFI International 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 TFI International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Properties and TFI International.
Diversification Opportunities for Boston Properties and TFI International
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Boston and TFI is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Boston Properties and TFI International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TFI International 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 TFI International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TFI International has no effect on the direction of Boston Properties i.e., Boston Properties and TFI International go up and down completely randomly.
Pair Corralation between Boston Properties and TFI International
Considering the 90-day investment horizon Boston Properties is expected to generate 1.24 times more return on investment than TFI International. However, Boston Properties is 1.24 times more volatile than TFI International. It trades about 0.08 of its potential returns per unit of risk. TFI International is currently generating about 0.04 per unit of risk. If you would invest 5,189 in Boston Properties on September 4, 2024 and sell it today you would earn a total of 2,899 from holding Boston Properties or generate 55.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boston Properties vs. TFI International
Performance |
| Timeline |
| Boston Properties |
| TFI International |
Boston Properties and TFI International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Properties and TFI International
The main advantage of trading using opposite Boston Properties and TFI International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Properties position performs unexpectedly, TFI International 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 TFI International will offset losses from the drop in TFI International's long position.| Boston Properties vs. SL Green Realty | Boston Properties vs. Douglas Emmett | Boston Properties vs. Kilroy Realty Corp | Boston Properties vs. Alexandria Real Estate |
| TFI International vs. Old Dominion Freight | TFI International vs. ArcBest Corp | TFI International vs. Marten Transport | TFI International vs. Werner Enterprises |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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