Correlation Between JBG SMITH and Bluerock Homes
Can any of the company-specific risk be diversified away by investing in both JBG SMITH and Bluerock Homes 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 JBG SMITH and Bluerock Homes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JBG SMITH Properties and Bluerock Homes Trust, you can compare the effects of market volatilities on JBG SMITH and Bluerock Homes 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 JBG SMITH with a short position of Bluerock Homes. Check out your portfolio center. Please also check ongoing floating volatility patterns of JBG SMITH and Bluerock Homes.
Diversification Opportunities for JBG SMITH and Bluerock Homes
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between JBG and Bluerock is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding JBG SMITH Properties and Bluerock Homes Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bluerock Homes Trust and JBG SMITH 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 JBG SMITH Properties are associated (or correlated) with Bluerock Homes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bluerock Homes Trust has no effect on the direction of JBG SMITH i.e., JBG SMITH and Bluerock Homes go up and down completely randomly.
Pair Corralation between JBG SMITH and Bluerock Homes
Given the investment horizon of 90 days JBG SMITH Properties is expected to under-perform the Bluerock Homes. In addition to that, JBG SMITH is 1.58 times more volatile than Bluerock Homes Trust. It trades about -0.13 of its total potential returns per unit of risk. Bluerock Homes Trust is currently generating about -0.17 per unit of volatility. If you would invest 1,463 in Bluerock Homes Trust on August 28, 2024 and sell it today you would lose (88.00) from holding Bluerock Homes Trust or give up 6.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JBG SMITH Properties vs. Bluerock Homes Trust
Performance |
| Timeline |
| JBG SMITH Properties |
| Bluerock Homes Trust |
JBG SMITH and Bluerock Homes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JBG SMITH and Bluerock Homes
The main advantage of trading using opposite JBG SMITH and Bluerock Homes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JBG SMITH position performs unexpectedly, Bluerock Homes 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 Bluerock Homes will offset losses from the drop in Bluerock Homes' long position.| JBG SMITH vs. Cousins Properties Incorporated | JBG SMITH vs. Highwoods Properties | JBG SMITH vs. Douglas Emmett | JBG SMITH vs. Equity Commonwealth |
| Bluerock Homes vs. Nexpoint Residential Trust | Bluerock Homes vs. Clipper Realty | Bluerock Homes vs. Centerspace | Bluerock Homes vs. Equity Lifestyle Properties |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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