Correlation Between HR Real and Armada Hflr
Can any of the company-specific risk be diversified away by investing in both HR Real and Armada Hflr 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 HR Real and Armada Hflr into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HR Real Estate and Armada Hflr Pr, you can compare the effects of market volatilities on HR Real and Armada Hflr 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 HR Real with a short position of Armada Hflr. Check out your portfolio center. Please also check ongoing floating volatility patterns of HR Real and Armada Hflr.
Diversification Opportunities for HR Real and Armada Hflr
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HRUFF and Armada is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding HR Real Estate and Armada Hflr Pr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Armada Hflr Pr and HR 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 HR Real Estate are associated (or correlated) with Armada Hflr. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Armada Hflr Pr has no effect on the direction of HR Real i.e., HR Real and Armada Hflr go up and down completely randomly.
Pair Corralation between HR Real and Armada Hflr
Assuming the 90 days horizon HR Real is expected to generate 3.04 times less return on investment than Armada Hflr. In addition to that, HR Real is 2.43 times more volatile than Armada Hflr Pr. It trades about 0.0 of its total potential returns per unit of risk. Armada Hflr Pr is currently generating about 0.02 per unit of volatility. If you would invest 1,017 in Armada Hflr Pr on September 13, 2024 and sell it today you would earn a total of 80.00 from holding Armada Hflr Pr or generate 7.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 89.68% |
| Values | Daily Returns |
HR Real Estate vs. Armada Hflr Pr
Performance |
| Timeline |
| HR Real Estate |
| Armada Hflr Pr |
HR Real and Armada Hflr Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HR Real and Armada Hflr
The main advantage of trading using opposite HR Real and Armada Hflr positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HR Real position performs unexpectedly, Armada Hflr 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 Armada Hflr will offset losses from the drop in Armada Hflr's long position.| HR Real vs. Generationome Properties | HR Real vs. Modiv Inc | HR Real vs. Broadstone Net Lease | HR Real vs. Gladstone Commercial |
| Armada Hflr vs. Modiv Inc | Armada Hflr vs. Precinct Properties New | Armada Hflr vs. Global Net Lease | Armada Hflr vs. NexPoint Diversified Real |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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