Correlation Between Crombie Real and Boston Properties
Can any of the company-specific risk be diversified away by investing in both Crombie Real and Boston Properties 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 Crombie Real and Boston Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crombie Real Estate and Boston Properties, you can compare the effects of market volatilities on Crombie Real and Boston Properties 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 Crombie Real with a short position of Boston Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crombie Real and Boston Properties.
Diversification Opportunities for Crombie Real and Boston Properties
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Crombie and Boston is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Crombie Real Estate and Boston Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boston Properties and Crombie Real 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 Crombie Real Estate are associated (or correlated) with Boston Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boston Properties has no effect on the direction of Crombie Real i.e., Crombie Real and Boston Properties go up and down completely randomly.
Pair Corralation between Crombie Real and Boston Properties
Assuming the 90 days horizon Crombie Real Estate is expected to under-perform the Boston Properties. In addition to that, Crombie Real is 1.03 times more volatile than Boston Properties. It trades about -0.06 of its total potential returns per unit of risk. Boston Properties is currently generating about 0.13 per unit of volatility. If you would invest 7,342 in Boston Properties on September 2, 2024 and sell it today you would earn a total of 857.00 from holding Boston Properties or generate 11.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 93.75% |
| Values | Daily Returns |
Crombie Real Estate vs. Boston Properties
Performance |
| Timeline |
| Crombie Real Estate |
| Boston Properties |
Crombie Real and Boston Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crombie Real and Boston Properties
The main advantage of trading using opposite Crombie Real and Boston Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crombie Real position performs unexpectedly, Boston Properties 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 Boston Properties will offset losses from the drop in Boston Properties' long position.| Crombie Real vs. Modiv Inc | Crombie Real vs. Presidio Property Trust | Crombie Real vs. Medalist Diversified Reit | Crombie Real vs. Gladstone Commercial |
| Boston Properties vs. Douglas Emmett | Boston Properties vs. Vornado Realty Trust | Boston Properties vs. Highwoods Properties | Boston Properties vs. Piedmont Office Realty |
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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