Correlation Between Healthcare Trust and Welltower

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

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Can any of the company-specific risk be diversified away by investing in both Healthcare Trust and Welltower at the same time? Although using correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combing Healthcare Trust and Welltower into the same portfolio which is an essential part of fundamental portfolio management process.

Diversification Opportunities for Healthcare Trust and Welltower

0.78
Correlation
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Poor diversification

The 3 months correlation between Healthcare and Welltower is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Healthcare Trust Of America In and Welltower Inc in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Welltower and Healthcare Trust 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 Healthcare Trust are associated (or correlated) with Welltower. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Welltower has no effect on the direction of Healthcare Trust i.e. Healthcare Trust and Welltower go up and down completely randomly.

Pair Corralation between Healthcare Trust and Welltower

Considering 30-days investment horizon, Healthcare Trust is expected to generate 0.6 times more return on investment than Welltower. However, Healthcare Trust is 1.66 times less risky than Welltower. It trades about -0.05 of its potential returns per unit of risk. Welltower is currently generating about -0.03 per unit of risk. If you would invest  3,353  in Healthcare Trust on May 3, 2020 and sell it today you would lose (664.00)  from holding Healthcare Trust or give up 19.8% of portfolio value over 30 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Healthcare Trust Of America In  vs.  Welltower Inc

 Performance (%) 
      Timeline 
Healthcare Trust 
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Healthcare Trust Risk-Adjusted Performance

Over the last 30 days Healthcare Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in July 2020. The current disturbance may also be a sign of long term up-swing for the company investors.
Welltower 
00

Welltower Risk-Adjusted Performance

Over the last 30 days Welltower has generated negative risk-adjusted returns adding no value to investors with long positions. Even with inconsistent performance in the last few months, the Stock's technical indicators remain considerably steady which may send shares a bit higher in July 2020. The new chaos may also be a sign of medium-term up-swing for the business stakeholders.

Healthcare Trust and Welltower Volatility Contrast

 Predicted Return Density 
      Returns 
Check out your portfolio center. Please also try Pattern Recognition module to use different pattern recognition models to time the market across multiple global exchanges.


 
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