Correlation Between Flux Power and Realty Income
Can any of the company-specific risk be diversified away by investing in both Flux Power and Realty Income 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 Flux Power and Realty Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flux Power Holdings and Realty Income Corp, you can compare the effects of market volatilities on Flux Power and Realty Income 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 Flux Power with a short position of Realty Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flux Power and Realty Income.
Diversification Opportunities for Flux Power and Realty Income
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Flux and Realty is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Flux Power Holdings and Realty Income Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Realty me Corp and Flux Power 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 Flux Power Holdings are associated (or correlated) with Realty Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Realty me Corp has no effect on the direction of Flux Power i.e., Flux Power and Realty Income go up and down completely randomly.
Pair Corralation between Flux Power and Realty Income
Given the investment horizon of 90 days Flux Power Holdings is expected to generate 3.73 times more return on investment than Realty Income. However, Flux Power is 3.73 times more volatile than Realty Income Corp. It trades about 0.04 of its potential returns per unit of risk. Realty Income Corp is currently generating about -0.02 per unit of risk. If you would invest 257.00 in Flux Power Holdings on January 20, 2024 and sell it today you would earn a total of 166.00 from holding Flux Power Holdings or generate 64.59% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Flux Power Holdings vs. Realty Income Corp
Performance |
Timeline |
Flux Power Holdings |
Realty me Corp |
Flux Power and Realty Income Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Flux Power and Realty Income
The main advantage of trading using opposite Flux Power and Realty Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flux Power position performs unexpectedly, Realty Income 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 Realty Income will offset losses from the drop in Realty Income's long position.Flux Power vs. Bloom Energy Corp | Flux Power vs. Microvast Holdings | Flux Power vs. Solid Power | Flux Power vs. FREYR Battery SA |
Realty Income vs. Federal Realty Investment | Realty Income vs. Macerich Company | Realty Income vs. National Retail Properties | Realty Income vs. Kimco Realty |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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