Correlation Between Healthcare Realty and DigitalBridge
Can any of the company-specific risk be diversified away by investing in both Healthcare Realty and DigitalBridge 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 DigitalBridge 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 DigitalBridge Group, you can compare the effects of market volatilities on Healthcare Realty and DigitalBridge 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 DigitalBridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Healthcare Realty and DigitalBridge.
Diversification Opportunities for Healthcare Realty and DigitalBridge
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Healthcare and DigitalBridge is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Healthcare Realty Trust and DigitalBridge Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DigitalBridge Group 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 DigitalBridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DigitalBridge Group has no effect on the direction of Healthcare Realty i.e., Healthcare Realty and DigitalBridge go up and down completely randomly.
Pair Corralation between Healthcare Realty and DigitalBridge
Allowing for the 90-day total investment horizon Healthcare Realty Trust is expected to generate 2.16 times more return on investment than DigitalBridge. However, Healthcare Realty is 2.16 times more volatile than DigitalBridge Group. It trades about 0.22 of its potential returns per unit of risk. DigitalBridge Group is currently generating about -0.23 per unit of risk. If you would invest 1,688 in Healthcare Realty Trust on September 1, 2024 and sell it today you would earn a total of 144.00 from holding Healthcare Realty Trust or generate 8.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Healthcare Realty Trust vs. DigitalBridge Group
Performance |
| Timeline |
| Healthcare Realty Trust |
| DigitalBridge Group |
Healthcare Realty and DigitalBridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Healthcare Realty and DigitalBridge
The main advantage of trading using opposite Healthcare Realty and DigitalBridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Healthcare Realty position performs unexpectedly, DigitalBridge 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 DigitalBridge will offset losses from the drop in DigitalBridge's long position.| Healthcare Realty vs. Douglas Emmett | Healthcare Realty vs. Kilroy Realty Corp | Healthcare Realty vs. Alexandria Real Estate | Healthcare Realty vs. Vornado Realty Trust |
| DigitalBridge vs. DigitalBridge Group | DigitalBridge vs. DigitalBridge Group | DigitalBridge vs. ACRES Commercial Realty | DigitalBridge vs. Chimera Investment |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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