Correlation Between VICI Properties and Firm Capital
Can any of the company-specific risk be diversified away by investing in both VICI Properties and Firm Capital 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 VICI Properties and Firm Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VICI Properties and Firm Capital Property, you can compare the effects of market volatilities on VICI Properties and Firm Capital 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 VICI Properties with a short position of Firm Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of VICI Properties and Firm Capital.
Diversification Opportunities for VICI Properties and Firm Capital
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between VICI and Firm is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding VICI Properties and Firm Capital Property in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Firm Capital Property and VICI Properties 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 VICI Properties are associated (or correlated) with Firm Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Firm Capital Property has no effect on the direction of VICI Properties i.e., VICI Properties and Firm Capital go up and down completely randomly.
Pair Corralation between VICI Properties and Firm Capital
Given the investment horizon of 90 days VICI Properties is expected to under-perform the Firm Capital. In addition to that, VICI Properties is 1.26 times more volatile than Firm Capital Property. It trades about -0.07 of its total potential returns per unit of risk. Firm Capital Property is currently generating about -0.01 per unit of volatility. If you would invest 429.00 in Firm Capital Property on August 25, 2024 and sell it today you would lose (1.00) from holding Firm Capital Property or give up 0.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VICI Properties vs. Firm Capital Property
Performance |
| Timeline |
| VICI Properties |
| Firm Capital Property |
VICI Properties and Firm Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VICI Properties and Firm Capital
The main advantage of trading using opposite VICI Properties and Firm Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VICI Properties position performs unexpectedly, Firm Capital 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 Firm Capital will offset losses from the drop in Firm Capital's long position.| VICI Properties vs. Broadstone Net Lease | VICI Properties vs. Armada Hflr Pr | VICI Properties vs. Brightspire Capital | VICI Properties vs. Safehold |
| Firm Capital vs. British Land | Firm Capital vs. Global Net Lease, | Firm Capital vs. VICI Properties | Firm Capital vs. British Land |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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