Correlation Between CBL Associates and Urban Edge
Can any of the company-specific risk be diversified away by investing in both CBL Associates and Urban Edge 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 Urban Edge 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 Urban Edge Properties, you can compare the effects of market volatilities on CBL Associates and Urban Edge 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 Urban Edge. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBL Associates and Urban Edge.
Diversification Opportunities for CBL Associates and Urban Edge
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CBL and Urban is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding CBL Associates Properties and Urban Edge Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Urban Edge Properties 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 Urban Edge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Urban Edge Properties has no effect on the direction of CBL Associates i.e., CBL Associates and Urban Edge go up and down completely randomly.
Pair Corralation between CBL Associates and Urban Edge
Considering the 90-day investment horizon CBL Associates Properties is expected to generate 1.02 times more return on investment than Urban Edge. However, CBL Associates is 1.02 times more volatile than Urban Edge Properties. It trades about 0.24 of its potential returns per unit of risk. Urban Edge Properties is currently generating about 0.21 per unit of risk. If you would invest 2,067 in CBL Associates Properties on August 26, 2024 and sell it today you would earn a total of 911.00 from holding CBL Associates Properties or generate 44.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
CBL Associates Properties vs. Urban Edge Properties
Performance |
| Timeline |
| CBL Associates Properties |
| Urban Edge Properties |
CBL Associates and Urban Edge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBL Associates and Urban Edge
The main advantage of trading using opposite CBL Associates and Urban Edge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBL Associates position performs unexpectedly, Urban Edge 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 Urban Edge will offset losses from the drop in Urban Edge'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 |
| Urban Edge vs. Site Centers Corp | Urban Edge vs. Inventrust Properties Corp | Urban Edge vs. Retail Opportunity Investments | Urban Edge vs. Netstreit Corp |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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