Correlation Between 26442UAE4 and Brandywine Realty

Can any of the company-specific risk be diversified away by investing in both 26442UAE4 and Brandywine Realty 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 26442UAE4 and Brandywine Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between DUKE ENERGY PROGRESS and Brandywine Realty Trust, you can compare the effects of market volatilities on 26442UAE4 and Brandywine Realty 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 26442UAE4 with a short position of Brandywine Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of 26442UAE4 and Brandywine Realty.

Diversification Opportunities for 26442UAE4 and Brandywine Realty

-0.17

Correlation Coefficient

26442UAE4  Brandywine Realty

Good diversification

The 3 months correlation between 26442UAE4 and Brandywine is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding DUKE ENERGY PROGRESS and Brandywine Realty Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brandywine Realty Trust and 26442UAE4 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 DUKE ENERGY PROGRESS are associated (or correlated) with Brandywine Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brandywine Realty Trust has no effect on the direction of 26442UAE4 i.e., 26442UAE4 and Brandywine Realty go up and down completely randomly.

Pair Corralation between 26442UAE4 and Brandywine Realty

Assuming the 90 days trading horizon DUKE ENERGY PROGRESS is expected to under-perform the Brandywine Realty. But the bond apears to be less risky and, when comparing its historical volatility, DUKE ENERGY PROGRESS is 1.92 times less risky than Brandywine Realty. The bond trades about -0.22 of its potential returns per unit of risk. The Brandywine Realty Trust is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  564.00  in Brandywine Realty Trust on October 10, 2024 and sell it today you would lose (25.00) from holding Brandywine Realty Trust or give up 4.43% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	54.1%
Values	Daily Returns

DUKE ENERGY PROGRESS  vs.  Brandywine Realty Trust

DUKE ENERGY PROGRESS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DUKE ENERGY PROGRESS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for DUKE ENERGY PROGRESS investors.

Brandywine Realty Trust

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Brandywine Realty Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental indicators, Brandywine Realty is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with 26442UAE4 and Brandywine Realty

The main advantage of trading using opposite 26442UAE4 and Brandywine Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 26442UAE4 position performs unexpectedly, Brandywine Realty 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 Brandywine Realty will offset losses from the drop in Brandywine Realty's long position.

The idea behind DUKE ENERGY PROGRESS and Brandywine Realty Trust 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.

Check out your portfolio center.

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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.