Correlation Between Short Real and Sa Real

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

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

Diversification Opportunities for Short Real and Sa Real

-0.91

Correlation Coefficient

Short Real  Sa Real

Pay attention - limited upside

The 3 months correlation between Short and SAREX is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding Short Real Estate and Sa Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sa Real Estate and Short 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 Short Real Estate are associated (or correlated) with Sa Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sa Real Estate has no effect on the direction of Short Real i.e., Short Real and Sa Real go up and down completely randomly.

Pair Corralation between Short Real and Sa Real

Assuming the 90 days horizon Short Real Estate is expected to generate 0.72 times more return on investment than Sa Real. However, Short Real Estate is 1.39 times less risky than Sa Real. It trades about 0.33 of its potential returns per unit of risk. Sa Real Estate is currently generating about -0.33 per unit of risk. If you would invest  777.00  in Short Real Estate on September 25, 2024 and sell it today you would earn a total of  67.00  from holding Short Real Estate or generate 8.62% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	95.24%
Values	Daily Returns

Short Real Estate  vs.  Sa Real Estate

Short Real Estate

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Short Real Estate are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Short Real may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Sa Real Estate

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sa Real Estate has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest unfluctuating performance, the Fund's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Short Real and Sa Real

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

The idea behind Short Real Estate and Sa Real Estate 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..