Correlation Between Vornado Realty and BTB Real
Can any of the company-specific risk be diversified away by investing in both Vornado Realty and BTB 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 Vornado Realty and BTB Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vornado Realty Trust and BTB Real Estate, you can compare the effects of market volatilities on Vornado Realty and BTB 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 Vornado Realty with a short position of BTB Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vornado Realty and BTB Real.
Diversification Opportunities for Vornado Realty and BTB Real
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Vornado and BTB is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Vornado Realty Trust and BTB Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTB Real Estate and Vornado Realty 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 Vornado Realty Trust are associated (or correlated) with BTB Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTB Real Estate has no effect on the direction of Vornado Realty i.e., Vornado Realty and BTB Real go up and down completely randomly.
Pair Corralation between Vornado Realty and BTB Real
Considering the 90-day investment horizon Vornado Realty Trust is expected to generate 1.93 times more return on investment than BTB Real. However, Vornado Realty is 1.93 times more volatile than BTB Real Estate. It trades about 0.24 of its potential returns per unit of risk. BTB Real Estate is currently generating about 0.13 per unit of risk. If you would invest 3,353 in Vornado Realty Trust on September 2, 2024 and sell it today you would earn a total of 952.00 from holding Vornado Realty Trust or generate 28.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.31% |
| Values | Daily Returns |
Vornado Realty Trust vs. BTB Real Estate
Performance |
| Timeline |
| Vornado Realty Trust |
| BTB Real Estate |
Vornado Realty and BTB Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vornado Realty and BTB Real
The main advantage of trading using opposite Vornado Realty and BTB Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vornado Realty position performs unexpectedly, BTB 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 BTB Real will offset losses from the drop in BTB Real's long position.| Vornado Realty vs. Boston Properties | Vornado Realty vs. Alexandria Real Estate | Vornado Realty vs. Brandywine Realty Trust | Vornado Realty vs. Hudson Pacific Properties |
| BTB Real vs. Boston Properties | BTB Real vs. Kilroy Realty Corp | BTB Real vs. SL Green Realty | BTB Real vs. Vornado Realty Trust |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |