Correlation Between FrontView REIT, and LILLY

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

By analyzing existing cross correlation between FrontView REIT, and LILLY ELI 275, you can compare the effects of market volatilities on FrontView REIT, and LILLY 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 LILLY. Check out your portfolio center. Please also check ongoing floating volatility patterns of FrontView REIT, and LILLY.

Diversification Opportunities for FrontView REIT, and LILLY

0.58

Correlation Coefficient

FrontView REIT,  LILLY

Very weak diversification

The 3 months correlation between FrontView and LILLY is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding FrontView REIT, and LILLY ELI 275 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LILLY ELI 275 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 LILLY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LILLY ELI 275 has no effect on the direction of FrontView REIT, i.e., FrontView REIT, and LILLY go up and down completely randomly.

Pair Corralation between FrontView REIT, and LILLY

Considering the 90-day investment horizon FrontView REIT, is expected to under-perform the LILLY. In addition to that, FrontView REIT, is 5.52 times more volatile than LILLY ELI 275. It trades about -0.14 of its total potential returns per unit of risk. LILLY ELI 275 is currently generating about 0.01 per unit of volatility. If you would invest  9,641  in LILLY ELI 275 on October 12, 2024 and sell it today you would earn a total of  89.00  from holding LILLY ELI 275 or generate 0.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	16.32%
Values	Daily Returns

FrontView REIT,  vs.  LILLY ELI 275

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

LILLY ELI 275

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days LILLY ELI 275 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, LILLY 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 LILLY

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

The idea behind FrontView REIT, and LILLY ELI 275 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.