Correlation Between Slate Office and PAX Global

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Slate Office and PAX Global 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 Slate Office and PAX Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Slate Office REIT and PAX Global Technology, you can compare the effects of market volatilities on Slate Office and PAX Global 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 Slate Office with a short position of PAX Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Slate Office and PAX Global.

Diversification Opportunities for Slate Office and PAX Global

0.62
  Correlation Coefficient

Poor diversification

The 3 months correlation between Slate and PAX is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Slate Office REIT and PAX Global Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PAX Global Technology and Slate Office 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 Slate Office REIT are associated (or correlated) with PAX Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PAX Global Technology has no effect on the direction of Slate Office i.e., Slate Office and PAX Global go up and down completely randomly.

Pair Corralation between Slate Office and PAX Global

Assuming the 90 days horizon Slate Office REIT is expected to generate 2.01 times more return on investment than PAX Global. However, Slate Office is 2.01 times more volatile than PAX Global Technology. It trades about 0.06 of its potential returns per unit of risk. PAX Global Technology is currently generating about 0.07 per unit of risk. If you would invest  26.00  in Slate Office REIT on September 12, 2024 and sell it today you would earn a total of  3.00  from holding Slate Office REIT or generate 11.54% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Slate Office REIT  vs.  PAX Global Technology

 Performance 
       Timeline  
Slate Office REIT 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Slate Office REIT are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, Slate Office reported solid returns over the last few months and may actually be approaching a breakup point.
PAX Global Technology 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in PAX Global Technology are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, PAX Global reported solid returns over the last few months and may actually be approaching a breakup point.

Slate Office and PAX Global Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Slate Office and PAX Global

The main advantage of trading using opposite Slate Office and PAX Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Slate Office position performs unexpectedly, PAX Global 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 PAX Global will offset losses from the drop in PAX Global's long position.
The idea behind Slate Office REIT and PAX Global Technology 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.
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.

Other Complementary Tools

Fundamentals Comparison
Compare fundamentals across multiple equities to find investing opportunities
Portfolio Comparator
Compare the composition, asset allocations and performance of any two portfolios in your account
Crypto Correlations
Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins
Idea Analyzer
Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas
Portfolio Holdings
Check your current holdings and cash postion to detemine if your portfolio needs rebalancing