Correlation Between CBL Associates and Realty Income
Can any of the company-specific risk be diversified away by investing in both CBL Associates and Realty Income 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 CBL Associates and Realty Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CBL Associates Properties and Realty Income, you can compare the effects of market volatilities on CBL Associates and Realty Income 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 CBL Associates with a short position of Realty Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBL Associates and Realty Income.
Diversification Opportunities for CBL Associates and Realty Income
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CBL and Realty is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding CBL Associates Properties and Realty Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Realty Income and CBL Associates 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 CBL Associates Properties are associated (or correlated) with Realty Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Realty Income has no effect on the direction of CBL Associates i.e., CBL Associates and Realty Income go up and down completely randomly.
Pair Corralation between CBL Associates and Realty Income
Considering the 90-day investment horizon CBL Associates Properties is expected to generate 1.13 times more return on investment than Realty Income. However, CBL Associates is 1.13 times more volatile than Realty Income. It trades about 0.44 of its potential returns per unit of risk. Realty Income is currently generating about -0.25 per unit of risk. If you would invest 2,708 in CBL Associates Properties on August 28, 2024 and sell it today you would earn a total of 349.00 from holding CBL Associates Properties or generate 12.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
CBL Associates Properties vs. Realty Income
Performance |
| Timeline |
| CBL Associates Properties |
| Realty Income |
CBL Associates and Realty Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBL Associates and Realty Income
The main advantage of trading using opposite CBL Associates and Realty Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBL Associates position performs unexpectedly, Realty Income 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 Realty Income will offset losses from the drop in Realty Income's long position.| CBL Associates vs. Investcorp Credit Management | CBL Associates vs. Medalist Diversified Reit | CBL Associates vs. Aquagold International | CBL Associates vs. Morningstar Unconstrained Allocation |
| Realty Income vs. Federal Realty Investment | Realty Income vs. Macerich Company | Realty Income vs. National Retail Properties | Realty Income vs. Kimco Realty |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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