Correlation Between Schroder Real and Global Net
Can any of the company-specific risk be diversified away by investing in both Schroder Real and Global Net 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 Schroder Real and Global Net into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schroder Real Estate and Global Net Lease, you can compare the effects of market volatilities on Schroder Real and Global Net 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 Schroder Real with a short position of Global Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schroder Real and Global Net.
Diversification Opportunities for Schroder Real and Global Net
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Schroder and Global is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Schroder Real Estate and Global Net Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Net Lease and Schroder Real 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 Schroder Real Estate are associated (or correlated) with Global Net. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Net Lease has no effect on the direction of Schroder Real i.e., Schroder Real and Global Net go up and down completely randomly.
Pair Corralation between Schroder Real and Global Net
Assuming the 90 days trading horizon Schroder Real Estate is expected to generate 0.74 times more return on investment than Global Net. However, Schroder Real Estate is 1.35 times less risky than Global Net. It trades about -0.04 of its potential returns per unit of risk. Global Net Lease is currently generating about -0.08 per unit of risk. If you would invest 5,180 in Schroder Real Estate on August 30, 2024 and sell it today you would lose (120.00) from holding Schroder Real Estate or give up 2.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.73% |
| Values | Daily Returns |
Schroder Real Estate vs. Global Net Lease
Performance |
| Timeline |
| Schroder Real Estate |
| Global Net Lease |
Schroder Real and Global Net Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Schroder Real and Global Net
The main advantage of trading using opposite Schroder Real and Global Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schroder Real position performs unexpectedly, Global Net 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 Global Net will offset losses from the drop in Global Net's long position.| Schroder Real vs. Derwent London PLC | Schroder Real vs. Hammerson PLC | Schroder Real vs. Workspace Group PLC | Schroder Real vs. Supermarket Income REIT |
| Global Net vs. Tungsten West PLC | Global Net vs. Argo Group Limited | Global Net vs. Hardide PLC | Global Net vs. Versarien PLC |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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