Correlation Between Welltower and Wheeler Real
Can any of the company-specific risk be diversified away by investing in both Welltower and Wheeler 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 Welltower and Wheeler Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Welltower and Wheeler Real Estate, you can compare the effects of market volatilities on Welltower and Wheeler 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 Welltower with a short position of Wheeler Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Welltower and Wheeler Real.
Diversification Opportunities for Welltower and Wheeler Real
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Welltower and Wheeler is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Welltower and Wheeler Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wheeler Real Estate and Welltower 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 Welltower are associated (or correlated) with Wheeler Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wheeler Real Estate has no effect on the direction of Welltower i.e., Welltower and Wheeler Real go up and down completely randomly.
Pair Corralation between Welltower and Wheeler Real
Given the investment horizon of 90 days Welltower is expected to generate 0.61 times more return on investment than Wheeler Real. However, Welltower is 1.63 times less risky than Wheeler Real. It trades about 0.16 of its potential returns per unit of risk. Wheeler Real Estate is currently generating about -0.58 per unit of risk. If you would invest 13,365 in Welltower on September 3, 2024 and sell it today you would earn a total of 453.00 from holding Welltower or generate 3.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 15.0% |
| Values | Daily Returns |
Welltower vs. Wheeler Real Estate
Performance |
| Timeline |
| Welltower |
| Wheeler Real Estate |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Welltower and Wheeler Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Welltower and Wheeler Real
The main advantage of trading using opposite Welltower and Wheeler Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Welltower position performs unexpectedly, Wheeler 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 Wheeler Real will offset losses from the drop in Wheeler Real's long position.| Welltower vs. Healthcare Realty Trust | Welltower vs. Sabra Healthcare REIT | Welltower vs. National Health Investors | Welltower vs. Global Medical REIT |
| Wheeler Real vs. The Mosaic | Wheeler Real vs. Origin Materials | Wheeler Real vs. Sealed Air | Wheeler Real vs. enVVeno Medical Corp |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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