Correlation Between Tanger Factory and Wheaton Precious
Can any of the company-specific risk be diversified away by investing in both Tanger Factory and Wheaton Precious 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 Tanger Factory and Wheaton Precious into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tanger Factory Outlet and Wheaton Precious Metals, you can compare the effects of market volatilities on Tanger Factory and Wheaton Precious 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 Tanger Factory with a short position of Wheaton Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tanger Factory and Wheaton Precious.
Diversification Opportunities for Tanger Factory and Wheaton Precious
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tanger and Wheaton is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Tanger Factory Outlet and Wheaton Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wheaton Precious Metals and Tanger Factory 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 Tanger Factory Outlet are associated (or correlated) with Wheaton Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wheaton Precious Metals has no effect on the direction of Tanger Factory i.e., Tanger Factory and Wheaton Precious go up and down completely randomly.
Pair Corralation between Tanger Factory and Wheaton Precious
Assuming the 90 days trading horizon Tanger Factory Outlet is expected to under-perform the Wheaton Precious. But the stock apears to be less risky and, when comparing its historical volatility, Tanger Factory Outlet is 2.59 times less risky than Wheaton Precious. The stock trades about -0.01 of its potential returns per unit of risk. The Wheaton Precious Metals is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 474,480 in Wheaton Precious Metals on September 12, 2024 and sell it today you would earn a total of 25,520 from holding Wheaton Precious Metals or generate 5.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Tanger Factory Outlet vs. Wheaton Precious Metals
Performance |
| Timeline |
| Tanger Factory Outlet |
| Wheaton Precious Metals |
Tanger Factory and Wheaton Precious Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tanger Factory and Wheaton Precious
The main advantage of trading using opposite Tanger Factory and Wheaton Precious positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tanger Factory position performs unexpectedly, Wheaton Precious 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 Wheaton Precious will offset losses from the drop in Wheaton Precious' long position.| Tanger Factory vs. Wheaton Precious Metals | Tanger Factory vs. Cornish Metals | Tanger Factory vs. National Bank of | Tanger Factory vs. Royal Bank of |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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