Correlation Between NexPoint Strategic and Brightspire Capital
Can any of the company-specific risk be diversified away by investing in both NexPoint Strategic and Brightspire 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 NexPoint Strategic and Brightspire Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NexPoint Strategic Opportunities and Brightspire Capital, you can compare the effects of market volatilities on NexPoint Strategic and Brightspire 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 NexPoint Strategic with a short position of Brightspire Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of NexPoint Strategic and Brightspire Capital.
Diversification Opportunities for NexPoint Strategic and Brightspire Capital
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between NexPoint and Brightspire is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding NexPoint Strategic Opportuniti and Brightspire Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brightspire Capital and NexPoint Strategic 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 NexPoint Strategic Opportunities are associated (or correlated) with Brightspire Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brightspire Capital has no effect on the direction of NexPoint Strategic i.e., NexPoint Strategic and Brightspire Capital go up and down completely randomly.
Pair Corralation between NexPoint Strategic and Brightspire Capital
Given the investment horizon of 90 days NexPoint Strategic Opportunities is expected to under-perform the Brightspire Capital. But the stock apears to be less risky and, when comparing its historical volatility, NexPoint Strategic Opportunities is 1.34 times less risky than Brightspire Capital. The stock trades about -0.04 of its potential returns per unit of risk. The Brightspire Capital is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 565.00 in Brightspire Capital on August 23, 2024 and sell it today you would earn a total of 53.00 from holding Brightspire Capital or generate 9.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NexPoint Strategic Opportuniti vs. Brightspire Capital
Performance |
| Timeline |
| NexPoint Strategic |
| Brightspire Capital |
NexPoint Strategic and Brightspire Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NexPoint Strategic and Brightspire Capital
The main advantage of trading using opposite NexPoint Strategic and Brightspire Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NexPoint Strategic position performs unexpectedly, Brightspire 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 Brightspire Capital will offset losses from the drop in Brightspire Capital's long position.| NexPoint Strategic vs. Modiv Inc | NexPoint Strategic vs. Gladstone Commercial Corp | NexPoint Strategic vs. CTO Realty Growth | NexPoint Strategic vs. Broadstone Net Lease |
| Brightspire Capital vs. Essential Properties Realty | Brightspire Capital vs. Armada Hflr Pr | Brightspire Capital vs. CTO Realty Growth | Brightspire Capital vs. Modiv Inc |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |