Correlation Between Prime Media and VistaREIT
Can any of the company-specific risk be diversified away by investing in both Prime Media and VistaREIT 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 Prime Media and VistaREIT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prime Media Holdings and VistaREIT, you can compare the effects of market volatilities on Prime Media and VistaREIT 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 Prime Media with a short position of VistaREIT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prime Media and VistaREIT.
Diversification Opportunities for Prime Media and VistaREIT
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Prime and VistaREIT is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Prime Media Holdings and VistaREIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VistaREIT and Prime Media 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 Prime Media Holdings are associated (or correlated) with VistaREIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VistaREIT has no effect on the direction of Prime Media i.e., Prime Media and VistaREIT go up and down completely randomly.
Pair Corralation between Prime Media and VistaREIT
Assuming the 90 days trading horizon Prime Media Holdings is expected to generate 3.9 times more return on investment than VistaREIT. However, Prime Media is 3.9 times more volatile than VistaREIT. It trades about 0.03 of its potential returns per unit of risk. VistaREIT is currently generating about 0.09 per unit of risk. If you would invest 190.00 in Prime Media Holdings on October 7, 2024 and sell it today you would earn a total of 1.00 from holding Prime Media Holdings or generate 0.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prime Media Holdings vs. VistaREIT
Performance |
| Timeline |
| Prime Media Holdings |
| VistaREIT |
Prime Media and VistaREIT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prime Media and VistaREIT
The main advantage of trading using opposite Prime Media and VistaREIT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prime Media position performs unexpectedly, VistaREIT 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 VistaREIT will offset losses from the drop in VistaREIT's long position.| Prime Media vs. Allhome Corp | Prime Media vs. Jollibee Foods Corp | Prime Media vs. Altus Property Ventures | Prime Media vs. Monde Nissin Corp |
| VistaREIT vs. Top Frontier Investment | VistaREIT vs. Lepanto Consolidated Mining | VistaREIT vs. Converge Information Communications | VistaREIT vs. Jollibee Foods 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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