Correlation Between Alexanders and Gladstone Land
Can any of the company-specific risk be diversified away by investing in both Alexanders and Gladstone Land 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 Alexanders and Gladstone Land into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alexanders and Gladstone Land, you can compare the effects of market volatilities on Alexanders and Gladstone Land 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 Alexanders with a short position of Gladstone Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alexanders and Gladstone Land.
Diversification Opportunities for Alexanders and Gladstone Land
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Alexanders and Gladstone is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Alexanders and Gladstone Land in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gladstone Land and Alexanders 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 Alexanders are associated (or correlated) with Gladstone Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gladstone Land has no effect on the direction of Alexanders i.e., Alexanders and Gladstone Land go up and down completely randomly.
Pair Corralation between Alexanders and Gladstone Land
Considering the 90-day investment horizon Alexanders is expected to generate 1.01 times more return on investment than Gladstone Land. However, Alexanders is 1.01 times more volatile than Gladstone Land. It trades about -0.02 of its potential returns per unit of risk. Gladstone Land is currently generating about -0.28 per unit of risk. If you would invest 22,554 in Alexanders on August 31, 2024 and sell it today you would lose (193.00) from holding Alexanders or give up 0.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alexanders vs. Gladstone Land
Performance |
| Timeline |
| Alexanders |
| Gladstone Land |
Alexanders and Gladstone Land Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alexanders and Gladstone Land
The main advantage of trading using opposite Alexanders and Gladstone Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alexanders position performs unexpectedly, Gladstone Land 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 Gladstone Land will offset losses from the drop in Gladstone Land's long position.| Alexanders vs. Saul Centers | Alexanders vs. Urban Edge Properties | Alexanders vs. Site Centers Corp | Alexanders vs. Kite Realty Group |
| Gladstone Land vs. Farmland Partners | Gladstone Land vs. STAG Industrial | Gladstone Land vs. Gladstone Commercial | Gladstone Land vs. LTC Properties |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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