Correlation Between BSR Real and Killam Apartment
Can any of the company-specific risk be diversified away by investing in both BSR Real and Killam Apartment 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 BSR Real and Killam Apartment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BSR Real Estate and Killam Apartment Real, you can compare the effects of market volatilities on BSR Real and Killam Apartment 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 BSR Real with a short position of Killam Apartment. Check out your portfolio center. Please also check ongoing floating volatility patterns of BSR Real and Killam Apartment.
Diversification Opportunities for BSR Real and Killam Apartment
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BSR and Killam is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding BSR Real Estate and Killam Apartment Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Killam Apartment Real and BSR Real 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 BSR Real Estate are associated (or correlated) with Killam Apartment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Killam Apartment Real has no effect on the direction of BSR Real i.e., BSR Real and Killam Apartment go up and down completely randomly.
Pair Corralation between BSR Real and Killam Apartment
Assuming the 90 days trading horizon BSR Real Estate is expected to under-perform the Killam Apartment. In addition to that, BSR Real is 1.44 times more volatile than Killam Apartment Real. It trades about -0.11 of its total potential returns per unit of risk. Killam Apartment Real is currently generating about -0.09 per unit of volatility. If you would invest 1,700 in Killam Apartment Real on November 9, 2024 and sell it today you would lose (36.00) from holding Killam Apartment Real or give up 2.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BSR Real Estate vs. Killam Apartment Real
Performance |
| Timeline |
| BSR Real Estate |
| Killam Apartment Real |
BSR Real and Killam Apartment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BSR Real and Killam Apartment
The main advantage of trading using opposite BSR Real and Killam Apartment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BSR Real position performs unexpectedly, Killam Apartment 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 Killam Apartment will offset losses from the drop in Killam Apartment's long position.| BSR Real vs. European Residential Real | BSR Real vs. Minto Apartment Real | BSR Real vs. BSR Real Estate | BSR Real vs. Morguard North American |
| Killam Apartment vs. InterRent Real Estate | Killam Apartment vs. Canadian Apartment Properties | Killam Apartment vs. Granite Real Estate | Killam Apartment vs. Crombie Real Estate |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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