Correlation Between Slate Grocery and Brookfield Office
Can any of the company-specific risk be diversified away by investing in both Slate Grocery and Brookfield Office 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 Slate Grocery and Brookfield Office into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Slate Grocery REIT and Brookfield Office Properties, you can compare the effects of market volatilities on Slate Grocery and Brookfield Office 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 Slate Grocery with a short position of Brookfield Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of Slate Grocery and Brookfield Office.
Diversification Opportunities for Slate Grocery and Brookfield Office
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Slate and Brookfield is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Slate Grocery REIT and Brookfield Office Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brookfield Office and Slate Grocery 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 Slate Grocery REIT are associated (or correlated) with Brookfield Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brookfield Office has no effect on the direction of Slate Grocery i.e., Slate Grocery and Brookfield Office go up and down completely randomly.
Pair Corralation between Slate Grocery and Brookfield Office
Assuming the 90 days trading horizon Slate Grocery is expected to generate 1.06 times less return on investment than Brookfield Office. In addition to that, Slate Grocery is 1.16 times more volatile than Brookfield Office Properties. It trades about 0.18 of its total potential returns per unit of risk. Brookfield Office Properties is currently generating about 0.22 per unit of volatility. If you would invest 990.00 in Brookfield Office Properties on November 6, 2024 and sell it today you would earn a total of 47.00 from holding Brookfield Office Properties or generate 4.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Slate Grocery REIT vs. Brookfield Office Properties
Performance |
| Timeline |
| Slate Grocery REIT |
| Brookfield Office |
Slate Grocery and Brookfield Office Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Slate Grocery and Brookfield Office
The main advantage of trading using opposite Slate Grocery and Brookfield Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Slate Grocery position performs unexpectedly, Brookfield Office 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 Brookfield Office will offset losses from the drop in Brookfield Office's long position.| Slate Grocery vs. Brookfield Asset Management | Slate Grocery vs. North American Financial | Slate Grocery vs. Canso Credit Trust | Slate Grocery vs. Element Fleet Management |
| Brookfield Office vs. Verizon Communications CDR | Brookfield Office vs. Pembina Pipeline Corp | Brookfield Office vs. Cogeco Communications | Brookfield Office vs. AKITA Drilling |
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.
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