Correlation Between Global Net and Fibra UNO
Can any of the company-specific risk be diversified away by investing in both Global Net and Fibra UNO 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 Global Net and Fibra UNO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Net Lease and Fibra UNO, you can compare the effects of market volatilities on Global Net and Fibra UNO 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 Global Net with a short position of Fibra UNO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Net and Fibra UNO.
Diversification Opportunities for Global Net and Fibra UNO
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Global and Fibra is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Global Net Lease and Fibra UNO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fibra UNO and Global Net 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 Global Net Lease are associated (or correlated) with Fibra UNO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fibra UNO has no effect on the direction of Global Net i.e., Global Net and Fibra UNO go up and down completely randomly.
Pair Corralation between Global Net and Fibra UNO
Assuming the 90 days trading horizon Global Net Lease is expected to generate 0.38 times more return on investment than Fibra UNO. However, Global Net Lease is 2.63 times less risky than Fibra UNO. It trades about -0.07 of its potential returns per unit of risk. Fibra UNO is currently generating about -0.12 per unit of risk. If you would invest 2,264 in Global Net Lease on August 29, 2024 and sell it today you would lose (51.00) from holding Global Net Lease or give up 2.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Global Net Lease vs. Fibra UNO
Performance |
| Timeline |
| Global Net Lease |
| Fibra UNO |
Global Net and Fibra UNO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Net and Fibra UNO
The main advantage of trading using opposite Global Net and Fibra UNO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Net position performs unexpectedly, Fibra UNO 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 Fibra UNO will offset losses from the drop in Fibra UNO's long position.| Global Net vs. Global Net Lease | Global Net vs. Global Medical REIT | Global Net vs. City Office REIT | Global Net vs. ARMOUR Residential REIT |
| Fibra UNO vs. Modiv Inc | Fibra UNO vs. Global Net Lease | Fibra UNO vs. NexPoint Diversified Real | Fibra UNO vs. Armada Hoffler 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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