Correlation Between Firm Capital and VICI Properties
Can any of the company-specific risk be diversified away by investing in both Firm Capital and VICI 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 Firm Capital and VICI Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Firm Capital Property and VICI Properties, you can compare the effects of market volatilities on Firm Capital and VICI 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 Firm Capital with a short position of VICI Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Firm Capital and VICI Properties.
Diversification Opportunities for Firm Capital and VICI Properties
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Firm and VICI is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Firm Capital Property and VICI Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VICI Properties and Firm 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 Firm Capital Property are associated (or correlated) with VICI Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VICI Properties has no effect on the direction of Firm Capital i.e., Firm Capital and VICI Properties go up and down completely randomly.
Pair Corralation between Firm Capital and VICI Properties
Assuming the 90 days horizon Firm Capital Property is expected to under-perform the VICI Properties. But the pink sheet apears to be less risky and, when comparing its historical volatility, Firm Capital Property is 1.17 times less risky than VICI Properties. The pink sheet trades about -0.03 of its potential returns per unit of risk. The VICI Properties is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 3,236 in VICI Properties on August 29, 2024 and sell it today you would earn a total of 2.00 from holding VICI Properties or generate 0.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Firm Capital Property vs. VICI Properties
Performance |
| Timeline |
| Firm Capital Property |
| VICI Properties |
Firm Capital and VICI Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Firm Capital and VICI Properties
The main advantage of trading using opposite Firm Capital and VICI Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Firm Capital position performs unexpectedly, VICI 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 VICI Properties will offset losses from the drop in VICI Properties' long position.| Firm Capital vs. Global Net Lease, | Firm Capital vs. VICI Properties | Firm Capital vs. Highlands REIT | Firm Capital vs. W P Carey |
| VICI Properties vs. Broadstone Net Lease | VICI Properties vs. Armada Hflr Pr | VICI Properties vs. Brightspire Capital | VICI Properties vs. Safehold |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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