Correlation Between Unity Software and Boston Properties

Can any of the company-specific risk be diversified away by investing in both Unity Software and Boston Properties 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 Unity Software and Boston Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Unity Software and Boston Properties

0.43

Correlation Coefficient

Unity Software  Boston Properties

Very weak diversification

The 3 months correlation between Unity and Boston is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Unity Software and Boston Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boston Properties and Unity Software 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 Unity Software are associated (or correlated) with Boston Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boston Properties has no effect on the direction of Unity Software i.e., Unity Software and Boston Properties go up and down completely randomly.

Pair Corralation between Unity Software and Boston Properties

Assuming the 90 days horizon Unity Software is expected to generate 2.51 times more return on investment than Boston Properties. However, Unity Software is 2.51 times more volatile than Boston Properties. It trades about 0.18 of its potential returns per unit of risk. Boston Properties is currently generating about 0.06 per unit of risk. If you would invest  1,957  in Unity Software on April 24, 2025 and sell it today you would earn a total of  1,108  from holding Unity Software or generate 56.62% return on investment over 90 days.

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

Unity Software  vs.  Boston Properties

Unity Software

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Unity Software are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Unity Software reported solid returns over the last few months and may actually be approaching a breakup point.

Boston Properties

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Boston Properties are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Boston Properties may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Unity Software and Boston Properties

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

The idea behind Unity Software and Boston Properties 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.