Correlation Between Office Properties and STORE Capital
Can any of the company-specific risk be diversified away by investing in both Office Properties and STORE 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 Office Properties and STORE Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Office Properties Income and STORE Capital Corp, you can compare the effects of market volatilities on Office Properties and STORE 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 Office Properties with a short position of STORE Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Office Properties and STORE Capital.
Diversification Opportunities for Office Properties and STORE Capital
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Office and STORE is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Office Properties Income and STORE Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STORE Capital Corp and Office Properties 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 Office Properties Income are associated (or correlated) with STORE Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STORE Capital Corp has no effect on the direction of Office Properties i.e., Office Properties and STORE Capital go up and down completely randomly.
Pair Corralation between Office Properties and STORE Capital
If you would invest 3,221 in STORE Capital Corp on August 30, 2024 and sell it today you would earn a total of 0.00 from holding STORE Capital Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Office Properties Income vs. STORE Capital Corp
Performance |
| Timeline |
| Office Properties Income |
| STORE Capital Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Office Properties and STORE Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Office Properties and STORE Capital
The main advantage of trading using opposite Office Properties and STORE Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Office Properties position performs unexpectedly, STORE 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 STORE Capital will offset losses from the drop in STORE Capital's long position.| Office Properties vs. Realty Income | Office Properties vs. First Industrial Realty | Office Properties vs. Healthcare Realty Trust | Office Properties vs. Park Hotels Resorts |
| STORE Capital vs. ScanSource | STORE Capital vs. Jabil Circuit | STORE Capital vs. Sphere Entertainment Co | STORE Capital vs. NETGEAR |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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