Correlation Between Postal Realty and Almacenes Xito
Can any of the company-specific risk be diversified away by investing in both Postal Realty and Almacenes Xito 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 Postal Realty and Almacenes Xito into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Postal Realty Trust and Almacenes xito SA, you can compare the effects of market volatilities on Postal Realty and Almacenes Xito 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 Postal Realty with a short position of Almacenes Xito. Check out your portfolio center. Please also check ongoing floating volatility patterns of Postal Realty and Almacenes Xito.
Diversification Opportunities for Postal Realty and Almacenes Xito
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Postal and Almacenes is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Postal Realty Trust and Almacenes xito SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Almacenes xito SA and Postal Realty 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 Postal Realty Trust are associated (or correlated) with Almacenes Xito. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Almacenes xito SA has no effect on the direction of Postal Realty i.e., Postal Realty and Almacenes Xito go up and down completely randomly.
Pair Corralation between Postal Realty and Almacenes Xito
Given the investment horizon of 90 days Postal Realty Trust is expected to generate 0.54 times more return on investment than Almacenes Xito. However, Postal Realty Trust is 1.86 times less risky than Almacenes Xito. It trades about 0.07 of its potential returns per unit of risk. Almacenes xito SA is currently generating about -0.05 per unit of risk. If you would invest 1,304 in Postal Realty Trust on September 3, 2024 and sell it today you would earn a total of 111.00 from holding Postal Realty Trust or generate 8.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Postal Realty Trust vs. Almacenes xito SA
Performance |
| Timeline |
| Postal Realty Trust |
| Almacenes xito SA |
Postal Realty and Almacenes Xito Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Postal Realty and Almacenes Xito
The main advantage of trading using opposite Postal Realty and Almacenes Xito positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Postal Realty position performs unexpectedly, Almacenes Xito 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 Almacenes Xito will offset losses from the drop in Almacenes Xito's long position.| Postal Realty vs. Office Properties Income | Postal Realty vs. SL Green Realty | Postal Realty vs. Highwoods Properties | Postal Realty vs. Equity Commonwealth |
| Almacenes Xito vs. Amkor Technology | Almacenes Xito vs. Celsius Holdings | Almacenes Xito vs. ServiceNow | Almacenes Xito vs. Molson Coors Brewing |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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