Correlation Between VistaREIT and Axelum Resources

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

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

Diversification Opportunities for VistaREIT and Axelum Resources

-0.19

Correlation Coefficient

VistaREIT  Axelum Resources

Good diversification

The 3 months correlation between VistaREIT and Axelum is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding VistaREIT and Axelum Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axelum Resources Corp and VistaREIT 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 VistaREIT are associated (or correlated) with Axelum Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axelum Resources Corp has no effect on the direction of VistaREIT i.e., VistaREIT and Axelum Resources go up and down completely randomly.

Pair Corralation between VistaREIT and Axelum Resources

Assuming the 90 days trading horizon VistaREIT is expected to generate 0.36 times more return on investment than Axelum Resources. However, VistaREIT is 2.81 times less risky than Axelum Resources. It trades about 0.12 of its potential returns per unit of risk. Axelum Resources Corp is currently generating about -0.03 per unit of risk. If you would invest  172.00  in VistaREIT on September 23, 2024 and sell it today you would earn a total of  14.00  from holding VistaREIT or generate 8.14% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	92.31%
Values	Daily Returns

VistaREIT  vs.  Axelum Resources Corp

VistaREIT

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in VistaREIT are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady technical and fundamental indicators, VistaREIT may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Axelum Resources Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Axelum Resources Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Axelum Resources is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with VistaREIT and Axelum Resources

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

The idea behind VistaREIT and Axelum Resources Corp 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.