Correlation Between FrontView REIT, and State Farm

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

By analyzing existing cross correlation between FrontView REIT, and State Farm Growth, you can compare the effects of market volatilities on FrontView REIT, and State Farm 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 State Farm. Check out your portfolio center. Please also check ongoing floating volatility patterns of FrontView REIT, and State Farm.

Diversification Opportunities for FrontView REIT, and State Farm

0.81

Correlation Coefficient

FrontView REIT,  State Farm

Very poor diversification

The 3 months correlation between FrontView and State is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding FrontView REIT, and State Farm Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Farm Growth 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 State Farm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Farm Growth has no effect on the direction of FrontView REIT, i.e., FrontView REIT, and State Farm go up and down completely randomly.

Pair Corralation between FrontView REIT, and State Farm

Considering the 90-day investment horizon FrontView REIT, is expected to under-perform the State Farm. In addition to that, FrontView REIT, is 2.77 times more volatile than State Farm Growth. It trades about -0.2 of its total potential returns per unit of risk. State Farm Growth is currently generating about -0.05 per unit of volatility. If you would invest  11,832  in State Farm Growth on December 28, 2024 and sell it today you would lose (327.00) from holding State Farm Growth or give up 2.76% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.36%
Values	Daily Returns

FrontView REIT,  vs.  State Farm Growth

FrontView REIT,

Risk-Adjusted Performance

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 uncertain performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

State Farm Growth

Risk-Adjusted Performance

Very Weak

Over the last 90 days State Farm Growth has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, State Farm is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with FrontView REIT, and State Farm

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

The idea behind FrontView REIT, and State Farm Growth 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.