Correlation Between Smart REIT and Saul Centers
Can any of the company-specific risk be diversified away by investing in both Smart REIT and Saul Centers 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 Smart REIT and Saul Centers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smart REIT and Saul Centers, you can compare the effects of market volatilities on Smart REIT and Saul Centers 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 Smart REIT with a short position of Saul Centers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smart REIT and Saul Centers.
Diversification Opportunities for Smart REIT and Saul Centers
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Smart and Saul is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Smart REIT and Saul Centers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saul Centers and Smart REIT 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 Smart REIT are associated (or correlated) with Saul Centers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saul Centers has no effect on the direction of Smart REIT i.e., Smart REIT and Saul Centers go up and down completely randomly.
Pair Corralation between Smart REIT and Saul Centers
Assuming the 90 days horizon Smart REIT is expected to under-perform the Saul Centers. In addition to that, Smart REIT is 1.06 times more volatile than Saul Centers. It trades about -0.14 of its total potential returns per unit of risk. Saul Centers is currently generating about -0.04 per unit of volatility. If you would invest 3,608 in Saul Centers on January 5, 2025 and sell it today you would lose (40.00) from holding Saul Centers or give up 1.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Smart REIT vs. Saul Centers
Performance |
| Timeline |
| Smart REIT |
| Saul Centers |
Smart REIT and Saul Centers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smart REIT and Saul Centers
The main advantage of trading using opposite Smart REIT and Saul Centers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smart REIT position performs unexpectedly, Saul Centers 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 Saul Centers will offset losses from the drop in Saul Centers' long position.| Smart REIT vs. Firm Capital Property | Smart REIT vs. Slate Grocery REIT | Smart REIT vs. Phillips Edison Co | Smart REIT vs. Choice Properties Real |
| Saul Centers vs. Urban Edge Properties | Saul Centers vs. Rithm Property Trust | Saul Centers vs. Site Centers Corp | Saul Centers vs. Kite Realty Group |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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