Correlation Between PEAK Old and Sabra Healthcare
Can any of the company-specific risk be diversified away by investing in both PEAK Old and Sabra Healthcare 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 PEAK Old and Sabra Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PEAK Old and Sabra Healthcare REIT, you can compare the effects of market volatilities on PEAK Old and Sabra Healthcare 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 PEAK Old with a short position of Sabra Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of PEAK Old and Sabra Healthcare.
Diversification Opportunities for PEAK Old and Sabra Healthcare
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PEAK and Sabra is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding PEAK Old and Sabra Healthcare REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabra Healthcare REIT and PEAK Old 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 PEAK Old are associated (or correlated) with Sabra Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabra Healthcare REIT has no effect on the direction of PEAK Old i.e., PEAK Old and Sabra Healthcare go up and down completely randomly.
Pair Corralation between PEAK Old and Sabra Healthcare
If you would invest 1,383 in Sabra Healthcare REIT on March 14, 2024 and sell it today you would earn a total of 16.00 from holding Sabra Healthcare REIT or generate 1.16% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 1.61% |
Values | Daily Returns |
PEAK Old vs. Sabra Healthcare REIT
Performance |
Timeline |
PEAK Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Sabra Healthcare REIT |
PEAK Old and Sabra Healthcare Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PEAK Old and Sabra Healthcare
The main advantage of trading using opposite PEAK Old and Sabra Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PEAK Old position performs unexpectedly, Sabra Healthcare 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 Sabra Healthcare will offset losses from the drop in Sabra Healthcare's long position.PEAK Old vs. Welltower | PEAK Old vs. Mid America Apartment Communities | PEAK Old vs. Regency Centers | PEAK Old vs. UDR Inc |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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