Correlation Between Forum Real and Great-west Real
Can any of the company-specific risk be diversified away by investing in both Forum Real and Great-west Real 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 Forum Real and Great-west Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Forum Real Estate and Great West Real Estate, you can compare the effects of market volatilities on Forum Real and Great-west Real 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 Forum Real with a short position of Great-west Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Forum Real and Great-west Real.
Diversification Opportunities for Forum Real and Great-west Real
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Forum and Great-west is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Forum Real Estate and Great West Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great West Real and Forum 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 Forum Real Estate are associated (or correlated) with Great-west Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great West Real has no effect on the direction of Forum Real i.e., Forum Real and Great-west Real go up and down completely randomly.
Pair Corralation between Forum Real and Great-west Real
Assuming the 90 days horizon Forum Real is expected to generate 1.8 times less return on investment than Great-west Real. But when comparing it to its historical volatility, Forum Real Estate is 10.98 times less risky than Great-west Real. It trades about 0.56 of its potential returns per unit of risk. Great West Real Estate is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,074 in Great West Real Estate on August 24, 2024 and sell it today you would earn a total of 267.00 from holding Great West Real Estate or generate 24.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Forum Real Estate vs. Great West Real Estate
Performance |
| Timeline |
| Forum Real Estate |
| Great West Real |
Forum Real and Great-west Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Forum Real and Great-west Real
The main advantage of trading using opposite Forum Real and Great-west Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Forum Real position performs unexpectedly, Great-west Real 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 Great-west Real will offset losses from the drop in Great-west Real's long position.| Forum Real vs. Gold And Precious | Forum Real vs. Short Precious Metals | Forum Real vs. Great West Goldman Sachs | Forum Real vs. Sprott Gold Equity |
| Great-west Real vs. Siit Large Cap | Great-west Real vs. Qs Large Cap | Great-west Real vs. Aqr Large Cap | Great-west Real vs. Nuveen Winslow Large Cap |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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