Correlation Between Converge Information and VistaREIT
Can any of the company-specific risk be diversified away by investing in both Converge Information and VistaREIT 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 Converge Information and VistaREIT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Converge Information Communications and VistaREIT, you can compare the effects of market volatilities on Converge Information and VistaREIT 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 Converge Information with a short position of VistaREIT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Converge Information and VistaREIT.
Diversification Opportunities for Converge Information and VistaREIT
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Converge and VistaREIT is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Converge Information Communica and VistaREIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VistaREIT and Converge Information 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 Converge Information Communications are associated (or correlated) with VistaREIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VistaREIT has no effect on the direction of Converge Information i.e., Converge Information and VistaREIT go up and down completely randomly.
Pair Corralation between Converge Information and VistaREIT
Assuming the 90 days trading horizon Converge Information Communications is expected to generate 0.91 times more return on investment than VistaREIT. However, Converge Information Communications is 1.1 times less risky than VistaREIT. It trades about 0.03 of its potential returns per unit of risk. VistaREIT is currently generating about -0.03 per unit of risk. If you would invest 1,640 in Converge Information Communications on October 9, 2024 and sell it today you would earn a total of 10.00 from holding Converge Information Communications or generate 0.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Converge Information Communica vs. VistaREIT
Performance |
| Timeline |
| Converge Information |
| VistaREIT |
Converge Information and VistaREIT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Converge Information and VistaREIT
The main advantage of trading using opposite Converge Information and VistaREIT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Converge Information position performs unexpectedly, VistaREIT 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 VistaREIT will offset losses from the drop in VistaREIT's long position.| Converge Information vs. Transpacific Broadband Group | Converge Information vs. Security Bank Corp | Converge Information vs. Lepanto Consolidated Mining | Converge Information vs. BDO Unibank |
| VistaREIT vs. COL Financial Group | VistaREIT vs. Metro Retail Stores | VistaREIT vs. Integrated Micro Electronics | VistaREIT vs. Apex Mining Co |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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