Correlation Between BSR Real and Nexus Real
Can any of the company-specific risk be diversified away by investing in both BSR Real and Nexus Real 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 Nexus Real 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 Nexus Real Estate, you can compare the effects of market volatilities on BSR Real and Nexus Real 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 Nexus Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of BSR Real and Nexus Real.
Diversification Opportunities for BSR Real and Nexus Real
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BSR and Nexus is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding BSR Real Estate and Nexus Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nexus Real Estate 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 Nexus Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nexus Real Estate has no effect on the direction of BSR Real i.e., BSR Real and Nexus Real go up and down completely randomly.
Pair Corralation between BSR Real and Nexus Real
Assuming the 90 days trading horizon BSR Real Estate is expected to generate 0.94 times more return on investment than Nexus Real. However, BSR Real Estate is 1.06 times less risky than Nexus Real. It trades about 0.01 of its potential returns per unit of risk. Nexus Real Estate is currently generating about -0.2 per unit of risk. If you would invest 1,827 in BSR Real Estate on August 29, 2024 and sell it today you would earn a total of 2.00 from holding BSR Real Estate or generate 0.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BSR Real Estate vs. Nexus Real Estate
Performance |
| Timeline |
| BSR Real Estate |
| Nexus Real Estate |
BSR Real and Nexus Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BSR Real and Nexus Real
The main advantage of trading using opposite BSR Real and Nexus Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BSR Real position performs unexpectedly, Nexus Real 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 Nexus Real will offset losses from the drop in Nexus Real'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 |
| Nexus Real vs. Slate Grocery REIT | Nexus Real vs. Pro Real Estate | Nexus Real vs. True North Commercial | Nexus Real vs. Inovalis 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |