Correlation Between Healthpeak Properties and LTC Properties
Can any of the company-specific risk be diversified away by investing in both Healthpeak Properties and LTC 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 Healthpeak Properties and LTC Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Healthpeak Properties and LTC Properties, you can compare the effects of market volatilities on Healthpeak Properties and LTC 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 Healthpeak Properties with a short position of LTC Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Healthpeak Properties and LTC Properties.
Diversification Opportunities for Healthpeak Properties and LTC Properties
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Healthpeak and LTC is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Healthpeak Properties and LTC Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LTC Properties and Healthpeak 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 Healthpeak Properties are associated (or correlated) with LTC Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LTC Properties has no effect on the direction of Healthpeak Properties i.e., Healthpeak Properties and LTC Properties go up and down completely randomly.
Pair Corralation between Healthpeak Properties and LTC Properties
Considering the 90-day investment horizon Healthpeak Properties is expected to under-perform the LTC Properties. But the stock apears to be less risky and, when comparing its historical volatility, Healthpeak Properties is 1.23 times less risky than LTC Properties. The stock trades about -0.04 of its potential returns per unit of risk. The LTC Properties is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 3,576 in LTC Properties on August 28, 2024 and sell it today you would earn a total of 267.00 from holding LTC Properties or generate 7.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Healthpeak Properties vs. LTC Properties
Performance |
| Timeline |
| Healthpeak Properties |
| LTC Properties |
Healthpeak Properties and LTC Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Healthpeak Properties and LTC Properties
The main advantage of trading using opposite Healthpeak Properties and LTC Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Healthpeak Properties position performs unexpectedly, LTC 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 LTC Properties will offset losses from the drop in LTC Properties' long position.| Healthpeak Properties vs. Healthcare Realty Trust | Healthpeak Properties vs. Sabra Healthcare REIT | Healthpeak Properties vs. Community Healthcare Trust | Healthpeak Properties vs. Universal Health Realty |
| LTC Properties vs. Medical Properties Trust | LTC Properties vs. Sabra Healthcare REIT | LTC Properties vs. Healthpeak Properties | LTC Properties vs. National Health Investors |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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