Correlation Between Boston Beer and Postal Realty
Can any of the company-specific risk be diversified away by investing in both Boston Beer and Postal Realty 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 Boston Beer and Postal Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Beer and Postal Realty Trust, you can compare the effects of market volatilities on Boston Beer and Postal Realty 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 Boston Beer with a short position of Postal Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Beer and Postal Realty.
Diversification Opportunities for Boston Beer and Postal Realty
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Boston and Postal is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Boston Beer and Postal Realty Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Postal Realty Trust and Boston Beer 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 Boston Beer are associated (or correlated) with Postal Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Postal Realty Trust has no effect on the direction of Boston Beer i.e., Boston Beer and Postal Realty go up and down completely randomly.
Pair Corralation between Boston Beer and Postal Realty
Considering the 90-day investment horizon Boston Beer is expected to under-perform the Postal Realty. In addition to that, Boston Beer is 2.38 times more volatile than Postal Realty Trust. It trades about 0.0 of its total potential returns per unit of risk. Postal Realty Trust is currently generating about 0.02 per unit of volatility. If you would invest 1,365 in Postal Realty Trust on September 3, 2024 and sell it today you would earn a total of 50.00 from holding Postal Realty Trust or generate 3.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boston Beer vs. Postal Realty Trust
Performance |
| Timeline |
| Boston Beer |
| Postal Realty Trust |
Boston Beer and Postal Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Beer and Postal Realty
The main advantage of trading using opposite Boston Beer and Postal Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Beer position performs unexpectedly, Postal Realty 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 Postal Realty will offset losses from the drop in Postal Realty's long position.| Boston Beer vs. Anheuser Busch Inbev | Boston Beer vs. Molson Coors Beverage | Boston Beer vs. Heineken NV | Boston Beer vs. Ambev SA ADR |
| Postal Realty vs. Office Properties Income | Postal Realty vs. SL Green Realty | Postal Realty vs. Highwoods Properties | Postal Realty vs. Equity Commonwealth |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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