Correlation Between Healthcare Realty and Brookfield Property
Can any of the company-specific risk be diversified away by investing in both Healthcare Realty and Brookfield Property 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 Healthcare Realty and Brookfield Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Healthcare Realty Trust and Brookfield Property Partners, you can compare the effects of market volatilities on Healthcare Realty and Brookfield Property 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 Healthcare Realty with a short position of Brookfield Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Healthcare Realty and Brookfield Property.
Diversification Opportunities for Healthcare Realty and Brookfield Property
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Healthcare and Brookfield is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Healthcare Realty Trust and Brookfield Property Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brookfield Property and Healthcare Realty 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 Healthcare Realty Trust are associated (or correlated) with Brookfield Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brookfield Property has no effect on the direction of Healthcare Realty i.e., Healthcare Realty and Brookfield Property go up and down completely randomly.
Pair Corralation between Healthcare Realty and Brookfield Property
Allowing for the 90-day total investment horizon Healthcare Realty Trust is expected to under-perform the Brookfield Property. In addition to that, Healthcare Realty is 1.46 times more volatile than Brookfield Property Partners. It trades about -0.05 of its total potential returns per unit of risk. Brookfield Property Partners is currently generating about 0.19 per unit of volatility. If you would invest 1,390 in Brookfield Property Partners on November 28, 2024 and sell it today you would earn a total of 48.00 from holding Brookfield Property Partners or generate 3.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Healthcare Realty Trust vs. Brookfield Property Partners
Performance |
| Timeline |
| Healthcare Realty Trust |
| Brookfield Property |
Healthcare Realty and Brookfield Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Healthcare Realty and Brookfield Property
The main advantage of trading using opposite Healthcare Realty and Brookfield Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Healthcare Realty position performs unexpectedly, Brookfield Property 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 Brookfield Property will offset losses from the drop in Brookfield Property's long position.| Healthcare Realty vs. Healthpeak Properties | Healthcare Realty vs. Sabra Healthcare REIT | Healthcare Realty vs. Community Healthcare Trust | Healthcare Realty vs. Universal Health Realty |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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