Correlation Between Green Brick and Global Medical
Can any of the company-specific risk be diversified away by investing in both Green Brick and Global Medical 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 Green Brick and Global Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Green Brick Partners and Global Medical REIT, you can compare the effects of market volatilities on Green Brick and Global Medical 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 Green Brick with a short position of Global Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Green Brick and Global Medical.
Diversification Opportunities for Green Brick and Global Medical
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Green and Global is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Green Brick Partners and Global Medical REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Medical REIT and Green Brick 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 Green Brick Partners are associated (or correlated) with Global Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Medical REIT has no effect on the direction of Green Brick i.e., Green Brick and Global Medical go up and down completely randomly.
Pair Corralation between Green Brick and Global Medical
Assuming the 90 days trading horizon Green Brick Partners is expected to generate 1.91 times more return on investment than Global Medical. However, Green Brick is 1.91 times more volatile than Global Medical REIT. It trades about 0.09 of its potential returns per unit of risk. Global Medical REIT is currently generating about 0.05 per unit of risk. If you would invest 1,729 in Green Brick Partners on August 25, 2024 and sell it today you would earn a total of 695.00 from holding Green Brick Partners or generate 40.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Green Brick Partners vs. Global Medical REIT
Performance |
| Timeline |
| Green Brick Partners |
| Global Medical REIT |
Green Brick and Global Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Green Brick and Global Medical
The main advantage of trading using opposite Green Brick and Global Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Green Brick position performs unexpectedly, Global Medical 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 Global Medical will offset losses from the drop in Global Medical's long position.| Green Brick vs. Global Medical REIT | Green Brick vs. Global Net Lease | Green Brick vs. The Hartford Financial | Green Brick vs. Saul Centers |
| Global Medical vs. Global Medical REIT | Global Medical vs. Community Healthcare Trust | Global Medical vs. National Health Investors | Global Medical vs. Healthcare Realty Trust |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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