Correlation Between Dynex Capital and Tiaa Cref
Can any of the company-specific risk be diversified away by investing in both Dynex Capital and Tiaa Cref 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 Dynex Capital and Tiaa Cref into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dynex Capital and Tiaa Cref Real Estate, you can compare the effects of market volatilities on Dynex Capital and Tiaa Cref 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 Dynex Capital with a short position of Tiaa Cref. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dynex Capital and Tiaa Cref.
Diversification Opportunities for Dynex Capital and Tiaa Cref
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dynex and Tiaa is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Dynex Capital and Tiaa Cref Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tiaa Cref Real and Dynex Capital 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 Dynex Capital are associated (or correlated) with Tiaa Cref. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tiaa Cref Real has no effect on the direction of Dynex Capital i.e., Dynex Capital and Tiaa Cref go up and down completely randomly.
Pair Corralation between Dynex Capital and Tiaa Cref
Allowing for the 90-day total investment horizon Dynex Capital is expected to generate 1.35 times less return on investment than Tiaa Cref. But when comparing it to its historical volatility, Dynex Capital is 1.15 times less risky than Tiaa Cref. It trades about 0.11 of its potential returns per unit of risk. Tiaa Cref Real Estate is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 2,016 in Tiaa Cref Real Estate on August 30, 2024 and sell it today you would earn a total of 58.00 from holding Tiaa Cref Real Estate or generate 2.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dynex Capital vs. Tiaa Cref Real Estate
Performance |
| Timeline |
| Dynex Capital |
| Tiaa Cref Real |
Dynex Capital and Tiaa Cref Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dynex Capital and Tiaa Cref
The main advantage of trading using opposite Dynex Capital and Tiaa Cref positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dynex Capital position performs unexpectedly, Tiaa Cref 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 Tiaa Cref will offset losses from the drop in Tiaa Cref's long position.| Dynex Capital vs. Ellington Residential Mortgage | Dynex Capital vs. Orchid Island Capital | Dynex Capital vs. Ellington Financial | Dynex Capital vs. Ares Commercial Real |
| Tiaa Cref vs. Realty Income | Tiaa Cref vs. Dynex Capital | Tiaa Cref vs. First Industrial Realty | Tiaa Cref vs. Healthcare Realty Trust |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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