Correlation Between Franklin Street and Broadstone Net
Can any of the company-specific risk be diversified away by investing in both Franklin Street and Broadstone Net 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 Franklin Street and Broadstone Net into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Street Properties and Broadstone Net Lease, you can compare the effects of market volatilities on Franklin Street and Broadstone Net 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 Franklin Street with a short position of Broadstone Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Street and Broadstone Net.
Diversification Opportunities for Franklin Street and Broadstone Net
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Franklin and Broadstone is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Street Properties and Broadstone Net Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Broadstone Net Lease and Franklin Street 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 Franklin Street Properties are associated (or correlated) with Broadstone Net. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Broadstone Net Lease has no effect on the direction of Franklin Street i.e., Franklin Street and Broadstone Net go up and down completely randomly.
Pair Corralation between Franklin Street and Broadstone Net
Considering the 90-day investment horizon Franklin Street Properties is expected to under-perform the Broadstone Net. In addition to that, Franklin Street is 2.0 times more volatile than Broadstone Net Lease. It trades about -0.03 of its total potential returns per unit of risk. Broadstone Net Lease is currently generating about 0.05 per unit of volatility. If you would invest 1,480 in Broadstone Net Lease on August 23, 2024 and sell it today you would earn a total of 224.00 from holding Broadstone Net Lease or generate 15.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Street Properties vs. Broadstone Net Lease
Performance |
| Timeline |
| Franklin Street Prop |
| Broadstone Net Lease |
Franklin Street and Broadstone Net Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Street and Broadstone Net
The main advantage of trading using opposite Franklin Street and Broadstone Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Street position performs unexpectedly, Broadstone Net 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 Broadstone Net will offset losses from the drop in Broadstone Net's long position.| Franklin Street vs. Turning Point Brands | Franklin Street vs. Maiden Holdings | Franklin Street vs. Ispire Technology Common | Franklin Street vs. Compania Cervecerias Unidas |
| Broadstone Net vs. Realty Income | Broadstone Net vs. Park Hotels Resorts | Broadstone Net vs. Power REIT | Broadstone Net vs. Urban Edge Properties |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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