Correlation Between Goodman and Comstock Holding
Can any of the company-specific risk be diversified away by investing in both Goodman and Comstock Holding 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 Goodman and Comstock Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goodman Group and Comstock Holding Companies, you can compare the effects of market volatilities on Goodman and Comstock Holding 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 Goodman with a short position of Comstock Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goodman and Comstock Holding.
Diversification Opportunities for Goodman and Comstock Holding
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Goodman and Comstock is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Goodman Group and Comstock Holding Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comstock Holding Com and Goodman 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 Goodman Group are associated (or correlated) with Comstock Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comstock Holding Com has no effect on the direction of Goodman i.e., Goodman and Comstock Holding go up and down completely randomly.
Pair Corralation between Goodman and Comstock Holding
Assuming the 90 days horizon Goodman Group is expected to generate 0.83 times more return on investment than Comstock Holding. However, Goodman Group is 1.2 times less risky than Comstock Holding. It trades about 0.08 of its potential returns per unit of risk. Comstock Holding Companies is currently generating about 0.05 per unit of risk. If you would invest 1,200 in Goodman Group on August 30, 2024 and sell it today you would earn a total of 1,532 from holding Goodman Group or generate 127.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 84.65% |
| Values | Daily Returns |
Goodman Group vs. Comstock Holding Companies
Performance |
| Timeline |
| Goodman Group |
| Comstock Holding Com |
Goodman and Comstock Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goodman and Comstock Holding
The main advantage of trading using opposite Goodman and Comstock Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goodman position performs unexpectedly, Comstock Holding 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 Comstock Holding will offset losses from the drop in Comstock Holding's long position.| Goodman vs. Modiv Inc | Goodman vs. Global Net Lease | Goodman vs. NexPoint Diversified Real | Goodman vs. Armada Hoffler Properties |
| Comstock Holding vs. St Joe Company | Comstock Holding vs. Stratus Properties | Comstock Holding vs. Mitsui Fudosan Co | Comstock Holding vs. New World Development |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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