Correlation Between CTO Realty and Presidio Property
Can any of the company-specific risk be diversified away by investing in both CTO Realty and Presidio Property 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 Presidio Property 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 Presidio Property Trust, you can compare the effects of market volatilities on CTO Realty and Presidio Property 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 Presidio Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of CTO Realty and Presidio Property.
Diversification Opportunities for CTO Realty and Presidio Property
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CTO and Presidio is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding CTO Realty Growth and Presidio Property Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Presidio Property Trust 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 Presidio Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Presidio Property Trust has no effect on the direction of CTO Realty i.e., CTO Realty and Presidio Property go up and down completely randomly.
Pair Corralation between CTO Realty and Presidio Property
Considering the 90-day investment horizon CTO Realty Growth is expected to generate 0.6 times more return on investment than Presidio Property. However, CTO Realty Growth is 1.68 times less risky than Presidio Property. It trades about 0.04 of its potential returns per unit of risk. Presidio Property Trust is currently generating about 0.02 per unit of risk. If you would invest 1,618 in CTO Realty Growth on August 30, 2024 and sell it today you would earn a total of 426.00 from holding CTO Realty Growth or generate 26.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
CTO Realty Growth vs. Presidio Property Trust
Performance |
| Timeline |
| CTO Realty Growth |
| Presidio Property Trust |
CTO Realty and Presidio Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CTO Realty and Presidio Property
The main advantage of trading using opposite CTO Realty and Presidio Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CTO Realty position performs unexpectedly, Presidio Property 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 Presidio Property will offset losses from the drop in Presidio Property's long position.| CTO Realty vs. Essential Properties Realty | CTO Realty vs. Armada Hflr Pr | CTO Realty vs. Brightspire Capital | CTO Realty vs. Broadstone Net Lease |
| Presidio Property vs. SiriusPoint | Presidio Property vs. RLJ Lodging Trust | Presidio Property vs. ARMOUR Residential REIT | Presidio Property vs. Sachem Capital 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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