Correlation Between Fator IFIX and Boston Properties
Can any of the company-specific risk be diversified away by investing in both Fator IFIX and Boston Properties 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 Fator IFIX and Boston Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fator IFIX Fundo and Boston Properties, you can compare the effects of market volatilities on Fator IFIX and Boston Properties 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 Fator IFIX with a short position of Boston Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fator IFIX and Boston Properties.
Diversification Opportunities for Fator IFIX and Boston Properties
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fator and Boston is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Fator IFIX Fundo and Boston Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boston Properties and Fator IFIX 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 Fator IFIX Fundo are associated (or correlated) with Boston Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boston Properties has no effect on the direction of Fator IFIX i.e., Fator IFIX and Boston Properties go up and down completely randomly.
Pair Corralation between Fator IFIX and Boston Properties
Assuming the 90 days trading horizon Fator IFIX Fundo is expected to under-perform the Boston Properties. But the fund apears to be less risky and, when comparing its historical volatility, Fator IFIX Fundo is 2.72 times less risky than Boston Properties. The fund trades about -0.12 of its potential returns per unit of risk. The Boston Properties is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 4,680 in Boston Properties on September 1, 2024 and sell it today you would earn a total of 310.00 from holding Boston Properties or generate 6.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fator IFIX Fundo vs. Boston Properties
Performance |
| Timeline |
| Fator IFIX Fundo |
| Boston Properties |
Fator IFIX and Boston Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fator IFIX and Boston Properties
The main advantage of trading using opposite Fator IFIX and Boston Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fator IFIX position performs unexpectedly, Boston Properties 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 Boston Properties will offset losses from the drop in Boston Properties' long position.| Fator IFIX vs. Real Estate Investment | Fator IFIX vs. NAVI CRDITO IMOBILIRIO | Fator IFIX vs. LIFE CAPITAL PARTNERS | Fator IFIX vs. Cshg Jhsf Prime |
| Boston Properties vs. Bio Techne | Boston Properties vs. STMicroelectronics NV | Boston Properties vs. GP Investments | Boston Properties vs. Technos SA |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |