Correlation Between CTO Realty and Global Net
Can any of the company-specific risk be diversified away by investing in both CTO Realty and Global Net 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 CTO Realty and Global Net into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CTO Realty Growth and Global Net Lease, you can compare the effects of market volatilities on CTO Realty and Global Net 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 CTO Realty with a short position of Global Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of CTO Realty and Global Net.
Diversification Opportunities for CTO Realty and Global Net
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CTO and Global is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding CTO Realty Growth and Global Net Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Net Lease and CTO Realty 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 CTO Realty Growth are associated (or correlated) with Global Net. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Net Lease has no effect on the direction of CTO Realty i.e., CTO Realty and Global Net go up and down completely randomly.
Pair Corralation between CTO Realty and Global Net
Assuming the 90 days trading horizon CTO Realty Growth is expected to generate 0.95 times more return on investment than Global Net. However, CTO Realty Growth is 1.05 times less risky than Global Net. It trades about 0.05 of its potential returns per unit of risk. Global Net Lease is currently generating about 0.04 per unit of risk. If you would invest 2,056 in CTO Realty Growth on October 26, 2024 and sell it today you would earn a total of 156.00 from holding CTO Realty Growth or generate 7.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CTO Realty Growth vs. Global Net Lease
Performance |
| Timeline |
| CTO Realty Growth |
| Global Net Lease |
CTO Realty and Global Net Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CTO Realty and Global Net
The main advantage of trading using opposite CTO Realty and Global Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CTO Realty position performs unexpectedly, Global Net 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 Global Net will offset losses from the drop in Global Net's long position.| CTO Realty vs. City Office REIT | CTO Realty vs. Armada Hoffler Properties | CTO Realty vs. Digital Realty Trust | CTO Realty vs. Global Net Lease |
| Global Net vs. Global Net Lease | Global Net vs. Global Medical REIT | Global Net vs. City Office REIT | Global Net vs. ARMOUR Residential REIT |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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