Correlation Between EastGroup Properties and Western Acquisition
Can any of the company-specific risk be diversified away by investing in both EastGroup Properties and Western Acquisition 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 Western Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EastGroup Properties and Western Acquisition Ventures, you can compare the effects of market volatilities on EastGroup Properties and Western Acquisition 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 Western Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of EastGroup Properties and Western Acquisition.
Diversification Opportunities for EastGroup Properties and Western Acquisition
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between EastGroup and Western is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding EastGroup Properties and Western Acquisition Ventures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Acquisition 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 Western Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Acquisition has no effect on the direction of EastGroup Properties i.e., EastGroup Properties and Western Acquisition go up and down completely randomly.
Pair Corralation between EastGroup Properties and Western Acquisition
If you would invest 1,154 in Western Acquisition Ventures on October 9, 2024 and sell it today you would earn a total of 0.00 from holding Western Acquisition Ventures or generate 0.0% 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. Western Acquisition Ventures
Performance |
| Timeline |
| EastGroup Properties |
| Western Acquisition |
EastGroup Properties and Western Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EastGroup Properties and Western Acquisition
The main advantage of trading using opposite EastGroup Properties and Western Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EastGroup Properties position performs unexpectedly, Western Acquisition 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 Western Acquisition will offset losses from the drop in Western Acquisition'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 |
| Western Acquisition vs. Frontier Group Holdings | Western Acquisition vs. Sun Life Financial | Western Acquisition vs. Delta Air Lines | Western Acquisition vs. Air Transport Services |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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