Correlation Between BTB Real and Slate Office

Can any of the company-specific risk be diversified away by investing in both BTB Real and Slate Office 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 BTB Real and Slate Office into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between BTB Real Estate and Slate Office REIT, you can compare the effects of market volatilities on BTB Real and Slate Office 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 BTB Real with a short position of Slate Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTB Real and Slate Office.

Diversification Opportunities for BTB Real and Slate Office

-0.65

Correlation Coefficient

BTB Real  Slate Office

Excellent diversification

The 3 months correlation between BTB and Slate is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding BTB Real Estate and Slate Office REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Slate Office REIT and BTB Real 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 BTB Real Estate are associated (or correlated) with Slate Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Slate Office REIT has no effect on the direction of BTB Real i.e., BTB Real and Slate Office go up and down completely randomly.

Pair Corralation between BTB Real and Slate Office

Assuming the 90 days horizon BTB Real Estate is expected to generate 0.23 times more return on investment than Slate Office. However, BTB Real Estate is 4.39 times less risky than Slate Office. It trades about 0.16 of its potential returns per unit of risk. Slate Office REIT is currently generating about -0.03 per unit of risk. If you would invest  239.00  in BTB Real Estate on May 5, 2025 and sell it today you would earn a total of  27.00  from holding BTB Real Estate or generate 11.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	95.31%
Values	Daily Returns

BTB Real Estate  vs.  Slate Office REIT

BTB Real Estate

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BTB Real Estate are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent forward indicators, BTB Real may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Slate Office REIT

Risk-Adjusted Performance

Very Weak

Over the last 90 days Slate Office REIT has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with BTB Real and Slate Office

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

The idea behind BTB Real Estate and Slate Office REIT 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.