Correlation Between Healthcare Realty and Dynex Capital
Can any of the company-specific risk be diversified away by investing in both Healthcare Realty and Dynex Capital 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 Dynex Capital 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 Dynex Capital, you can compare the effects of market volatilities on Healthcare Realty and Dynex Capital 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 Dynex Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Healthcare Realty and Dynex Capital.
Diversification Opportunities for Healthcare Realty and Dynex Capital
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Healthcare and Dynex is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Healthcare Realty Trust and Dynex Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dynex Capital 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 Dynex Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dynex Capital has no effect on the direction of Healthcare Realty i.e., Healthcare Realty and Dynex Capital go up and down completely randomly.
Pair Corralation between Healthcare Realty and Dynex Capital
Allowing for the 90-day total investment horizon Healthcare Realty Trust is expected to generate 2.3 times more return on investment than Dynex Capital. However, Healthcare Realty is 2.3 times more volatile than Dynex Capital. It trades about 0.12 of its potential returns per unit of risk. Dynex Capital is currently generating about 0.07 per unit of risk. If you would invest 1,761 in Healthcare Realty Trust on August 29, 2024 and sell it today you would earn a total of 94.00 from holding Healthcare Realty Trust or generate 5.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Healthcare Realty Trust vs. Dynex Capital
Performance |
| Timeline |
| Healthcare Realty Trust |
| Dynex Capital |
Healthcare Realty and Dynex Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Healthcare Realty and Dynex Capital
The main advantage of trading using opposite Healthcare Realty and Dynex Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Healthcare Realty position performs unexpectedly, Dynex Capital 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 Dynex Capital will offset losses from the drop in Dynex Capital'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 |
| Dynex Capital vs. Ellington Residential Mortgage | Dynex Capital vs. Orchid Island Capital | Dynex Capital vs. ARMOUR Residential REIT | Dynex Capital vs. Ellington Financial |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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