Correlation Between VICI Properties and FirstService Corp
Can any of the company-specific risk be diversified away by investing in both VICI Properties and FirstService Corp 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 FirstService Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VICI Properties and FirstService Corp, you can compare the effects of market volatilities on VICI Properties and FirstService Corp 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 FirstService Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of VICI Properties and FirstService Corp.
Diversification Opportunities for VICI Properties and FirstService Corp
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between VICI and FirstService is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding VICI Properties and FirstService Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FirstService Corp 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 FirstService Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FirstService Corp has no effect on the direction of VICI Properties i.e., VICI Properties and FirstService Corp go up and down completely randomly.
Pair Corralation between VICI Properties and FirstService Corp
Given the investment horizon of 90 days VICI Properties is expected to generate 2.62 times less return on investment than FirstService Corp. But when comparing it to its historical volatility, VICI Properties is 1.06 times less risky than FirstService Corp. It trades about 0.03 of its potential returns per unit of risk. FirstService Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 14,475 in FirstService Corp on August 27, 2024 and sell it today you would earn a total of 4,773 from holding FirstService Corp or generate 32.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VICI Properties vs. FirstService Corp
Performance |
| Timeline |
| VICI Properties |
| FirstService Corp |
VICI Properties and FirstService Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VICI Properties and FirstService Corp
The main advantage of trading using opposite VICI Properties and FirstService Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VICI Properties position performs unexpectedly, FirstService Corp 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 FirstService Corp will offset losses from the drop in FirstService Corp's long position.| VICI Properties vs. Broadstone Net Lease | VICI Properties vs. Armada Hflr Pr | VICI Properties vs. Brightspire Capital | VICI Properties vs. Safehold |
| FirstService Corp vs. Cushman Wakefield plc | FirstService Corp vs. CBRE Group Class | FirstService Corp vs. Jones Lang LaSalle | FirstService Corp vs. Marcus Millichap |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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