Correlation Between Slate Grocery and Nexus Real
Can any of the company-specific risk be diversified away by investing in both Slate Grocery and Nexus Real 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 Nexus Real 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 Nexus Real Estate, you can compare the effects of market volatilities on Slate Grocery and Nexus Real 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 Nexus Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Slate Grocery and Nexus Real.
Diversification Opportunities for Slate Grocery and Nexus Real
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Slate and Nexus is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Slate Grocery REIT and Nexus Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nexus Real Estate 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 Nexus Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nexus Real Estate has no effect on the direction of Slate Grocery i.e., Slate Grocery and Nexus Real go up and down completely randomly.
Pair Corralation between Slate Grocery and Nexus Real
Assuming the 90 days trading horizon Slate Grocery REIT is expected to generate 0.69 times more return on investment than Nexus Real. However, Slate Grocery REIT is 1.45 times less risky than Nexus Real. It trades about 0.25 of its potential returns per unit of risk. Nexus Real Estate is currently generating about -0.21 per unit of risk. If you would invest 1,394 in Slate Grocery REIT on August 28, 2024 and sell it today you would earn a total of 81.00 from holding Slate Grocery REIT or generate 5.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Slate Grocery REIT vs. Nexus Real Estate
Performance |
| Timeline |
| Slate Grocery REIT |
| Nexus Real Estate |
Slate Grocery and Nexus Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Slate Grocery and Nexus Real
The main advantage of trading using opposite Slate Grocery and Nexus Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Slate Grocery position performs unexpectedly, Nexus Real 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 Nexus Real will offset losses from the drop in Nexus Real's long position.| Slate Grocery vs. True North Commercial | Slate Grocery vs. Slate Office REIT | Slate Grocery vs. Inovalis Real Estate | Slate Grocery vs. NorthWest Healthcare Properties |
| Nexus Real vs. Slate Grocery REIT | Nexus Real vs. Pro Real Estate | Nexus Real vs. True North Commercial | Nexus Real vs. Inovalis Real Estate |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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