Correlation Between Storage Vault and Brookfield Office
Can any of the company-specific risk be diversified away by investing in both Storage Vault 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 Storage Vault and Brookfield Office into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Storage Vault Canada and Brookfield Office Properties, you can compare the effects of market volatilities on Storage Vault 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 Storage Vault with a short position of Brookfield Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of Storage Vault and Brookfield Office.
Diversification Opportunities for Storage Vault and Brookfield Office
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Storage and Brookfield is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Storage Vault Canada and Brookfield Office Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brookfield Office and Storage Vault 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 Storage Vault Canada 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 Storage Vault i.e., Storage Vault and Brookfield Office go up and down completely randomly.
Pair Corralation between Storage Vault and Brookfield Office
Assuming the 90 days trading horizon Storage Vault Canada is expected to under-perform the Brookfield Office. In addition to that, Storage Vault is 1.39 times more volatile than Brookfield Office Properties. It trades about -0.07 of its total potential returns per unit of risk. Brookfield Office Properties is currently generating about 0.13 per unit of volatility. If you would invest 1,288 in Brookfield Office Properties on October 22, 2024 and sell it today you would earn a total of 495.00 from holding Brookfield Office Properties or generate 38.43% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Storage Vault Canada vs. Brookfield Office Properties
Performance |
Timeline |
Storage Vault Canada |
Brookfield Office |
Storage Vault and Brookfield Office Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Storage Vault and Brookfield Office
The main advantage of trading using opposite Storage Vault and Brookfield Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Storage Vault 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.Storage Vault vs. BSR Real Estate | Storage Vault vs. Nexus Real Estate | Storage Vault vs. European Residential Real | Storage Vault vs. Minto Apartment Real |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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