Correlation Between Highwoods Properties and Gecina SA
Can any of the company-specific risk be diversified away by investing in both Highwoods Properties and Gecina SA 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 Gecina SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Highwoods Properties and Gecina SA, you can compare the effects of market volatilities on Highwoods Properties and Gecina SA 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 Gecina SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highwoods Properties and Gecina SA.
Diversification Opportunities for Highwoods Properties and Gecina SA
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Highwoods and Gecina is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Highwoods Properties and Gecina SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gecina SA 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 Gecina SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gecina SA has no effect on the direction of Highwoods Properties i.e., Highwoods Properties and Gecina SA go up and down completely randomly.
Pair Corralation between Highwoods Properties and Gecina SA
Considering the 90-day investment horizon Highwoods Properties is expected to generate 0.7 times more return on investment than Gecina SA. However, Highwoods Properties is 1.43 times less risky than Gecina SA. It trades about 0.07 of its potential returns per unit of risk. Gecina SA is currently generating about 0.01 per unit of risk. If you would invest 1,994 in Highwoods Properties on September 12, 2024 and sell it today you would earn a total of 1,075 from holding Highwoods Properties or generate 53.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 61.66% |
| Values | Daily Returns |
Highwoods Properties vs. Gecina SA
Performance |
| Timeline |
| Highwoods Properties |
| Gecina SA |
Highwoods Properties and Gecina SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Highwoods Properties and Gecina SA
The main advantage of trading using opposite Highwoods Properties and Gecina SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highwoods Properties position performs unexpectedly, Gecina SA 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 Gecina SA will offset losses from the drop in Gecina SA'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 |
| Gecina SA vs. Highwoods Properties | Gecina SA vs. Piedmont Office Realty | Gecina SA vs. Douglas Emmett | Gecina SA vs. Kilroy Realty Corp |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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