Correlation Between Corporate Office and City Office
Can any of the company-specific risk be diversified away by investing in both Corporate Office and City Office 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 Corporate Office and City Office into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Corporate Office Properties and City Office, you can compare the effects of market volatilities on Corporate Office and City Office 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 Corporate Office with a short position of City Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of Corporate Office and City Office.
Diversification Opportunities for Corporate Office and City Office
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Corporate and City is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Corporate Office Properties and City Office in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on City Office and Corporate Office 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 Corporate Office Properties are associated (or correlated) with City Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of City Office has no effect on the direction of Corporate Office i.e., Corporate Office and City Office go up and down completely randomly.
Pair Corralation between Corporate Office and City Office
If you would invest 2,592 in Corporate Office Properties on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Corporate Office Properties or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Corporate Office Properties vs. City Office
Performance |
| Timeline |
| Corporate Office Pro |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| City Office |
Corporate Office and City Office Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Corporate Office and City Office
The main advantage of trading using opposite Corporate Office and City Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Corporate Office position performs unexpectedly, City Office 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 City Office will offset losses from the drop in City Office's long position.| Corporate Office vs. Highwoods Properties | Corporate Office vs. Piedmont Office Realty | Corporate Office vs. Douglas Emmett | Corporate Office vs. Kilroy Realty Corp |
| City Office vs. Hudson Pacific Properties | City Office vs. Piedmont Office Realty | City Office vs. Office Properties Income | City Office vs. Kilroy Realty 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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