Correlation Between Omega Healthcare and Rexford Industrial
Can any of the company-specific risk be diversified away by investing in both Omega Healthcare and Rexford Industrial 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 Rexford Industrial 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 Rexford Industrial Realty, you can compare the effects of market volatilities on Omega Healthcare and Rexford Industrial 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 Rexford Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Omega Healthcare and Rexford Industrial.
Diversification Opportunities for Omega Healthcare and Rexford Industrial
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Omega and Rexford is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Omega Healthcare Investors and Rexford Industrial Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rexford Industrial Realty 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 Rexford Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rexford Industrial Realty has no effect on the direction of Omega Healthcare i.e., Omega Healthcare and Rexford Industrial go up and down completely randomly.
Pair Corralation between Omega Healthcare and Rexford Industrial
Considering the 90-day investment horizon Omega Healthcare Investors is expected to generate 0.66 times more return on investment than Rexford Industrial. However, Omega Healthcare Investors is 1.52 times less risky than Rexford Industrial. It trades about 0.19 of its potential returns per unit of risk. Rexford Industrial Realty is currently generating about -0.01 per unit of risk. If you would invest 3,172 in Omega Healthcare Investors on September 2, 2024 and sell it today you would earn a total of 889.00 from holding Omega Healthcare Investors or generate 28.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Omega Healthcare Investors vs. Rexford Industrial Realty
Performance |
| Timeline |
| Omega Healthcare Inv |
| Rexford Industrial Realty |
Omega Healthcare and Rexford Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Omega Healthcare and Rexford Industrial
The main advantage of trading using opposite Omega Healthcare and Rexford Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Omega Healthcare position performs unexpectedly, Rexford Industrial 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 Rexford Industrial will offset losses from the drop in Rexford Industrial's long position.| Omega Healthcare vs. Douglas Emmett | Omega Healthcare vs. Vornado Realty Trust | Omega Healthcare vs. Highwoods Properties | Omega Healthcare vs. Piedmont Office Realty |
| Rexford Industrial vs. Plymouth Industrial REIT | Rexford Industrial vs. EastGroup Properties | Rexford Industrial vs. LXP Industrial Trust | Rexford Industrial vs. Terreno Realty |
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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