Correlation Between EastGroup Properties and Franklin Street
Can any of the company-specific risk be diversified away by investing in both EastGroup Properties and Franklin Street 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 EastGroup Properties and Franklin Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EastGroup Properties and Franklin Street Properties, you can compare the effects of market volatilities on EastGroup Properties and Franklin Street 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 EastGroup Properties with a short position of Franklin Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of EastGroup Properties and Franklin Street.
Diversification Opportunities for EastGroup Properties and Franklin Street
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between EastGroup and Franklin is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding EastGroup Properties and Franklin Street Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Street Prop and EastGroup Properties 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 EastGroup Properties are associated (or correlated) with Franklin Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Street Prop has no effect on the direction of EastGroup Properties i.e., EastGroup Properties and Franklin Street go up and down completely randomly.
Pair Corralation between EastGroup Properties and Franklin Street
Considering the 90-day investment horizon EastGroup Properties is expected to generate 0.43 times more return on investment than Franklin Street. However, EastGroup Properties is 2.3 times less risky than Franklin Street. It trades about 0.03 of its potential returns per unit of risk. Franklin Street Properties is currently generating about -0.01 per unit of risk. If you would invest 14,686 in EastGroup Properties on September 4, 2024 and sell it today you would earn a total of 2,383 from holding EastGroup Properties or generate 16.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EastGroup Properties vs. Franklin Street Properties
Performance |
| Timeline |
| EastGroup Properties |
| Franklin Street Prop |
EastGroup Properties and Franklin Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EastGroup Properties and Franklin Street
The main advantage of trading using opposite EastGroup Properties and Franklin Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EastGroup Properties position performs unexpectedly, Franklin Street 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 Franklin Street will offset losses from the drop in Franklin Street's long position.| EastGroup Properties vs. Terreno Realty | EastGroup Properties vs. Plymouth Industrial REIT | EastGroup Properties vs. LXP Industrial Trust | EastGroup Properties vs. First Industrial Realty |
| Franklin Street vs. Equity Commonwealth | Franklin Street vs. Cousins Properties Incorporated | Franklin Street vs. Creative Media Community | Franklin Street vs. Highwoods Properties |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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