Correlation Between Morgan Stanley and Brixmor Property

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

By analyzing existing cross correlation between Morgan Stanley Direct and Brixmor Property Group, you can compare the effects of market volatilities on Morgan Stanley and Brixmor Property 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 Morgan Stanley with a short position of Brixmor Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Morgan Stanley and Brixmor Property.

Diversification Opportunities for Morgan Stanley and Brixmor Property

0.82

Correlation Coefficient

Morgan Stanley  Brixmor Property

Very poor diversification

The 3 months correlation between Morgan and Brixmor is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Morgan Stanley Direct and Brixmor Property Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brixmor Property and Morgan Stanley 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 Morgan Stanley Direct are associated (or correlated) with Brixmor Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brixmor Property has no effect on the direction of Morgan Stanley i.e., Morgan Stanley and Brixmor Property go up and down completely randomly.

Pair Corralation between Morgan Stanley and Brixmor Property

Given the investment horizon of 90 days Morgan Stanley is expected to generate 10.1 times less return on investment than Brixmor Property. In addition to that, Morgan Stanley is 1.22 times more volatile than Brixmor Property Group. It trades about 0.01 of its total potential returns per unit of risk. Brixmor Property Group is currently generating about 0.13 per unit of volatility. If you would invest  1,992  in Brixmor Property Group on September 24, 2024 and sell it today you would earn a total of  628.00  from holding Brixmor Property Group or generate 31.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	97.65%
Values	Daily Returns

Morgan Stanley Direct  vs.  Brixmor Property Group

Morgan Stanley Direct

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Morgan Stanley Direct are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite quite unsteady fundamental indicators, Morgan Stanley may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Brixmor Property

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Brixmor Property Group are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Brixmor Property may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Morgan Stanley and Brixmor Property

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

The idea behind Morgan Stanley Direct and Brixmor Property Group 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.

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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.