Correlation Between Douglas Emmett and Netstreit Corp

Can any of the company-specific risk be diversified away by investing in both Douglas Emmett and Netstreit Corp 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 Douglas Emmett and Netstreit Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Douglas Emmett and Netstreit Corp

0.4

Correlation Coefficient

Douglas Emmett  Netstreit Corp

Very weak diversification

The 3 months correlation between Douglas and Netstreit is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Douglas Emmett and Netstreit Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Netstreit Corp and Douglas Emmett 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 Douglas Emmett are associated (or correlated) with Netstreit Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Netstreit Corp has no effect on the direction of Douglas Emmett i.e., Douglas Emmett and Netstreit Corp go up and down completely randomly.

Pair Corralation between Douglas Emmett and Netstreit Corp

Considering the 90-day investment horizon Douglas Emmett is expected to generate 20.13 times less return on investment than Netstreit Corp. In addition to that, Douglas Emmett is 1.66 times more volatile than Netstreit Corp. It trades about 0.01 of its total potential returns per unit of risk. Netstreit Corp is currently generating about 0.28 per unit of volatility. If you would invest  1,568  in Netstreit Corp on May 17, 2025 and sell it today you would earn a total of  309.00  from holding Netstreit Corp or generate 19.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Douglas Emmett  vs.  Netstreit Corp

Douglas Emmett

Risk-Adjusted Performance

Weakest

Over the last 90 days Douglas Emmett has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical and fundamental indicators, Douglas Emmett is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Netstreit Corp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Netstreit Corp are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Netstreit Corp unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Douglas Emmett and Netstreit Corp

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

The idea behind Douglas Emmett and Netstreit Corp 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.