This module allows you to analyze existing cross correlation between Realty Income Corporation and VEREIT Inc. You can compare the effects of market volatilities on Realty Income and VEREIT 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 Realty Income with a short position of VEREIT. See also your portfolio center
. Please also check ongoing floating volatility patterns of Realty Income
Realty Income Corp. vs VEREIT Inc
Taking into account the 30 trading days horizon, Realty Income Corporation is expected to generate 0.6 times more return on investment than VEREIT. However, Realty Income Corporation is 1.66 times less risky than VEREIT. It trades about -0.19 of its potential returns per unit of risk. VEREIT Inc is currently generating about -0.2 per unit of risk. If you would invest 5,667 in Realty Income Corporation on November 12, 2017 and sell it today you would lose (125) from holding Realty Income Corporation or give up 2.21% of portfolio value over 30 days.
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Very poor diversification
Overlapping area represents the amount of risk that can be diversified away by holding Realty Income Corp. and VEREIT Inc in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on VEREIT Inc and Realty Income 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 Realty Income Corporation are associated (or correlated) with VEREIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VEREIT Inc has no effect on the direction of Realty Income i.e. Realty Income and VEREIT go up and down completely randomly.
Over the last 30 days Realty Income Corporation has generated negative risk-adjusted returns adding no value to investors with long positions.
Over the last 30 days VEREIT Inc has generated negative risk-adjusted returns adding no value to investors with long positions.