Correlation Between Avalon GloboCare and Brookfield Property

Can any of the company-specific risk be diversified away by investing in both Avalon GloboCare and Brookfield Property 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 Avalon GloboCare and Brookfield Property into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Avalon GloboCare Corp and Brookfield Property Partners, you can compare the effects of market volatilities on Avalon GloboCare and Brookfield Property 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 Avalon GloboCare with a short position of Brookfield Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avalon GloboCare and Brookfield Property.

Diversification Opportunities for Avalon GloboCare and Brookfield Property

0.27

Correlation Coefficient

Avalon GloboCare  Brookfield Property

Modest diversification

The 3 months correlation between Avalon and Brookfield is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Avalon GloboCare Corp and Brookfield Property Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brookfield Property and Avalon GloboCare 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 Avalon GloboCare Corp are associated (or correlated) with Brookfield Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brookfield Property has no effect on the direction of Avalon GloboCare i.e., Avalon GloboCare and Brookfield Property go up and down completely randomly.

Pair Corralation between Avalon GloboCare and Brookfield Property

Given the investment horizon of 90 days Avalon GloboCare Corp is expected to generate 7.34 times more return on investment than Brookfield Property. However, Avalon GloboCare is 7.34 times more volatile than Brookfield Property Partners. It trades about 0.13 of its potential returns per unit of risk. Brookfield Property Partners is currently generating about -0.01 per unit of risk. If you would invest  329.00  in Avalon GloboCare Corp on December 27, 2024 and sell it today you would earn a total of  203.00  from holding Avalon GloboCare Corp or generate 61.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Avalon GloboCare Corp  vs.  Brookfield Property Partners

Avalon GloboCare Corp

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Avalon GloboCare Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile fundamental drivers, Avalon GloboCare unveiled solid returns over the last few months and may actually be approaching a breakup point.

Brookfield Property

Risk-Adjusted Performance

Very Weak

Over the last 90 days Brookfield Property Partners has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Brookfield Property is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Avalon GloboCare and Brookfield Property

The main advantage of trading using opposite Avalon GloboCare and Brookfield Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avalon GloboCare position performs unexpectedly, Brookfield Property 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 Property will offset losses from the drop in Brookfield Property's long position.

The idea behind Avalon GloboCare Corp and Brookfield Property Partners pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.