Correlation Between FrontView REIT, and AIB Group

Can any of the company-specific risk be diversified away by investing in both FrontView REIT, and AIB Group 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 FrontView REIT, and AIB Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FrontView REIT, and AIB Group plc, you can compare the effects of market volatilities on FrontView REIT, and AIB Group 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 FrontView REIT, with a short position of AIB Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of FrontView REIT, and AIB Group.

Diversification Opportunities for FrontView REIT, and AIB Group

-0.27

Correlation Coefficient

FrontView REIT,  AIB Group

Very good diversification

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

Pair Corralation between FrontView REIT, and AIB Group

Considering the 90-day investment horizon FrontView REIT, is expected to under-perform the AIB Group. But the stock apears to be less risky and, when comparing its historical volatility, FrontView REIT, is 2.05 times less risky than AIB Group. The stock trades about -0.04 of its potential returns per unit of risk. The AIB Group plc is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  334.00  in AIB Group plc on September 23, 2024 and sell it today you would earn a total of  173.00  from holding AIB Group plc or generate 51.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	11.64%
Values	Daily Returns

FrontView REIT,  vs.  AIB Group plc

FrontView REIT,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days FrontView REIT, has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, FrontView REIT, is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

AIB Group plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AIB Group plc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, AIB Group is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with FrontView REIT, and AIB Group

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

The idea behind FrontView REIT, and AIB Group plc 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.