Correlation Between HR Real and Generationome Properties

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

By analyzing existing cross correlation between HR Real Estate and Generationome Properties, you can compare the effects of market volatilities on HR Real and Generationome Properties 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 HR Real with a short position of Generationome Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of HR Real and Generationome Properties.

Diversification Opportunities for HR Real and Generationome Properties

0.78

Correlation Coefficient

HR Real  Generationome Properties

Poor diversification

The 3 months correlation between HRUFF and Generationome is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding HR Real Estate and Generationome Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Generationome Properties and HR Real 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 HR Real Estate are associated (or correlated) with Generationome Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Generationome Properties has no effect on the direction of HR Real i.e., HR Real and Generationome Properties go up and down completely randomly.

Pair Corralation between HR Real and Generationome Properties

Assuming the 90 days horizon HR Real Estate is expected to generate 0.67 times more return on investment than Generationome Properties. However, HR Real Estate is 1.5 times less risky than Generationome Properties. It trades about -0.02 of its potential returns per unit of risk. Generationome Properties is currently generating about -0.05 per unit of risk. If you would invest  797.00  in HR Real Estate on September 12, 2024 and sell it today you would lose (122.00) from holding HR Real Estate or give up 15.31% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	87.22%
Values	Daily Returns

HR Real Estate  vs.  Generationome Properties

HR Real Estate

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days HR Real Estate has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Generationome Properties

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Generationome Properties has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with HR Real and Generationome Properties

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

The idea behind HR Real Estate and Generationome Properties 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 Anywhere module to track or share privately all of your investments from the convenience of any device.