Correlation Between Sabra Healthcare and Bluerock Homes
Can any of the company-specific risk be diversified away by investing in both Sabra Healthcare and Bluerock Homes 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 Sabra Healthcare and Bluerock Homes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sabra Healthcare REIT and Bluerock Homes Trust, you can compare the effects of market volatilities on Sabra Healthcare and Bluerock Homes 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 Sabra Healthcare with a short position of Bluerock Homes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabra Healthcare and Bluerock Homes.
Diversification Opportunities for Sabra Healthcare and Bluerock Homes
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sabra and Bluerock is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Sabra Healthcare REIT and Bluerock Homes Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bluerock Homes Trust and Sabra Healthcare 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 Sabra Healthcare REIT are associated (or correlated) with Bluerock Homes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bluerock Homes Trust has no effect on the direction of Sabra Healthcare i.e., Sabra Healthcare and Bluerock Homes go up and down completely randomly.
Pair Corralation between Sabra Healthcare and Bluerock Homes
Given the investment horizon of 90 days Sabra Healthcare REIT is expected to generate 0.61 times more return on investment than Bluerock Homes. However, Sabra Healthcare REIT is 1.63 times less risky than Bluerock Homes. It trades about 0.08 of its potential returns per unit of risk. Bluerock Homes Trust is currently generating about -0.01 per unit of risk. If you would invest 1,038 in Sabra Healthcare REIT on September 12, 2024 and sell it today you would earn a total of 717.50 from holding Sabra Healthcare REIT or generate 69.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sabra Healthcare REIT vs. Bluerock Homes Trust
Performance |
| Timeline |
| Sabra Healthcare REIT |
| Bluerock Homes Trust |
Sabra Healthcare and Bluerock Homes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sabra Healthcare and Bluerock Homes
The main advantage of trading using opposite Sabra Healthcare and Bluerock Homes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabra Healthcare position performs unexpectedly, Bluerock Homes 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 Bluerock Homes will offset losses from the drop in Bluerock Homes' long position.| Sabra Healthcare vs. Healthcare Realty Trust | Sabra Healthcare vs. Healthpeak Properties | Sabra Healthcare vs. Community Healthcare Trust | Sabra Healthcare vs. Universal Health Realty |
| Bluerock Homes vs. Nexpoint Residential Trust | Bluerock Homes vs. Clipper Realty | Bluerock Homes vs. Centerspace | Bluerock Homes vs. Equity Lifestyle Properties |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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