Correlation Between Highwoods Properties and Global X
Can any of the company-specific risk be diversified away by investing in both Highwoods Properties and Global X 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 Highwoods Properties and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Highwoods Properties and Global X FinTech, you can compare the effects of market volatilities on Highwoods Properties and Global X 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 Highwoods Properties with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highwoods Properties and Global X.
Diversification Opportunities for Highwoods Properties and Global X
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Highwoods and Global is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Highwoods Properties and Global X FinTech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X FinTech and Highwoods Properties 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 Highwoods Properties are associated (or correlated) with Global X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global X FinTech has no effect on the direction of Highwoods Properties i.e., Highwoods Properties and Global X go up and down completely randomly.
Pair Corralation between Highwoods Properties and Global X
Considering the 90-day investment horizon Highwoods Properties is expected to generate 1.53 times less return on investment than Global X. In addition to that, Highwoods Properties is 1.38 times more volatile than Global X FinTech. It trades about 0.04 of its total potential returns per unit of risk. Global X FinTech is currently generating about 0.08 per unit of volatility. If you would invest 2,028 in Global X FinTech on September 3, 2024 and sell it today you would earn a total of 1,372 from holding Global X FinTech or generate 67.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Highwoods Properties vs. Global X FinTech
Performance |
| Timeline |
| Highwoods Properties |
| Global X FinTech |
Highwoods Properties and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Highwoods Properties and Global X
The main advantage of trading using opposite Highwoods Properties and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highwoods Properties position performs unexpectedly, Global X 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 X will offset losses from the drop in Global X's long position.| Highwoods Properties vs. Piedmont Office Realty | Highwoods Properties vs. Douglas Emmett | Highwoods Properties vs. Kilroy Realty Corp | Highwoods Properties vs. Hudson Pacific Properties |
| Global X vs. Vanguard Information Technology | Global X vs. Technology Select Sector | Global X vs. iShares Technology ETF | Global X vs. VanEck Semiconductor ETF |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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