Correlation Between Link Real and Vastned Retail
Can any of the company-specific risk be diversified away by investing in both Link Real and Vastned Retail 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 Link Real and Vastned Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Link Real Estate and Vastned Retail NV, you can compare the effects of market volatilities on Link Real and Vastned Retail 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 Link Real with a short position of Vastned Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Link Real and Vastned Retail.
Diversification Opportunities for Link Real and Vastned Retail
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Link and Vastned is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Link Real Estate and Vastned Retail NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vastned Retail NV and Link 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 Link Real Estate are associated (or correlated) with Vastned Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vastned Retail NV has no effect on the direction of Link Real i.e., Link Real and Vastned Retail go up and down completely randomly.
Pair Corralation between Link Real and Vastned Retail
Assuming the 90 days horizon Link Real Estate is expected to generate 7.02 times more return on investment than Vastned Retail. However, Link Real is 7.02 times more volatile than Vastned Retail NV. It trades about 0.14 of its potential returns per unit of risk. Vastned Retail NV is currently generating about 0.07 per unit of risk. If you would invest 283.00 in Link Real Estate on September 4, 2024 and sell it today you would earn a total of 132.00 from holding Link Real Estate or generate 46.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.46% |
| Values | Daily Returns |
Link Real Estate vs. Vastned Retail NV
Performance |
| Timeline |
| Link Real Estate |
| Vastned Retail NV |
Link Real and Vastned Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Link Real and Vastned Retail
The main advantage of trading using opposite Link Real and Vastned Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Link Real position performs unexpectedly, Vastned Retail 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 Vastned Retail will offset losses from the drop in Vastned Retail's long position.| Link Real vs. Computer And Technologies | Link Real vs. FARO Technologies | Link Real vs. Cogent Communications Holdings | Link Real vs. SK TELECOM TDADR |
| Vastned Retail vs. Simon Property Group | Vastned Retail vs. Link Real Estate | Vastned Retail vs. Kimco Realty | Vastned Retail vs. Range Resources Corp |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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