Correlation Between Fidus Investment and Postal Realty
Can any of the company-specific risk be diversified away by investing in both Fidus Investment and Postal Realty 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 Fidus Investment and Postal Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidus Investment Corp and Postal Realty Trust, you can compare the effects of market volatilities on Fidus Investment and Postal Realty 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 Fidus Investment with a short position of Postal Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidus Investment and Postal Realty.
Diversification Opportunities for Fidus Investment and Postal Realty
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fidus and Postal is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Fidus Investment Corp and Postal Realty Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Postal Realty Trust and Fidus Investment 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 Fidus Investment Corp are associated (or correlated) with Postal Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Postal Realty Trust has no effect on the direction of Fidus Investment i.e., Fidus Investment and Postal Realty go up and down completely randomly.
Pair Corralation between Fidus Investment and Postal Realty
Given the investment horizon of 90 days Fidus Investment Corp is expected to generate 0.76 times more return on investment than Postal Realty. However, Fidus Investment Corp is 1.31 times less risky than Postal Realty. It trades about 0.11 of its potential returns per unit of risk. Postal Realty Trust is currently generating about 0.07 per unit of risk. If you would invest 1,910 in Fidus Investment Corp on August 30, 2024 and sell it today you would earn a total of 198.00 from holding Fidus Investment Corp or generate 10.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidus Investment Corp vs. Postal Realty Trust
Performance |
| Timeline |
| Fidus Investment Corp |
| Postal Realty Trust |
Fidus Investment and Postal Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidus Investment and Postal Realty
The main advantage of trading using opposite Fidus Investment and Postal Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidus Investment position performs unexpectedly, Postal Realty 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 Postal Realty will offset losses from the drop in Postal Realty's long position.| Fidus Investment vs. Golub Capital BDC | Fidus Investment vs. BlackRock TCP Capital | Fidus Investment vs. Carlyle Secured Lending | Fidus Investment vs. Sixth Street Specialty |
| Postal Realty vs. Office Properties Income | Postal Realty vs. Boston Properties | Postal Realty vs. SL Green Realty | Postal Realty vs. Alexandria Real Estate |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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