Correlation Between Omega Healthcare and Prologis
Can any of the company-specific risk be diversified away by investing in both Omega Healthcare and Prologis 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 Omega Healthcare and Prologis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Omega Healthcare Investors, and Prologis, you can compare the effects of market volatilities on Omega Healthcare and Prologis 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 Omega Healthcare with a short position of Prologis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Omega Healthcare and Prologis.
Diversification Opportunities for Omega Healthcare and Prologis
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Omega and Prologis is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Omega Healthcare Investors, and Prologis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prologis and Omega Healthcare 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 Omega Healthcare Investors, are associated (or correlated) with Prologis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prologis has no effect on the direction of Omega Healthcare i.e., Omega Healthcare and Prologis go up and down completely randomly.
Pair Corralation between Omega Healthcare and Prologis
Assuming the 90 days trading horizon Omega Healthcare Investors, is expected to under-perform the Prologis. But the stock apears to be less risky and, when comparing its historical volatility, Omega Healthcare Investors, is 1.93 times less risky than Prologis. The stock trades about -0.22 of its potential returns per unit of risk. The Prologis is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 5,491 in Prologis on November 4, 2024 and sell it today you would earn a total of 264.00 from holding Prologis or generate 4.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 77.27% |
| Values | Daily Returns |
Omega Healthcare Investors, vs. Prologis
Performance |
| Timeline |
| Omega Healthcare Inv |
| Prologis |
Omega Healthcare and Prologis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Omega Healthcare and Prologis
The main advantage of trading using opposite Omega Healthcare and Prologis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Omega Healthcare position performs unexpectedly, Prologis 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 Prologis will offset losses from the drop in Prologis' long position.| Omega Healthcare vs. Apartment Investment and | Omega Healthcare vs. Micron Technology | Omega Healthcare vs. DXC Technology | Omega Healthcare vs. American Airlines Group |
| Prologis vs. T Mobile | Prologis vs. Zoom Video Communications | Prologis vs. CRISPR Therapeutics AG | Prologis vs. Verizon Communications |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |