Correlation Between EPR Properties and Outfront Media
Can any of the company-specific risk be diversified away by investing in both EPR Properties and Outfront Media 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 EPR Properties and Outfront Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EPR Properties and Outfront Media, you can compare the effects of market volatilities on EPR Properties and Outfront Media 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 EPR Properties with a short position of Outfront Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of EPR Properties and Outfront Media.
Diversification Opportunities for EPR Properties and Outfront Media
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between EPR and Outfront is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding EPR Properties and Outfront Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Outfront Media and EPR 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 EPR Properties are associated (or correlated) with Outfront Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Outfront Media has no effect on the direction of EPR Properties i.e., EPR Properties and Outfront Media go up and down completely randomly.
Pair Corralation between EPR Properties and Outfront Media
Assuming the 90 days trading horizon EPR Properties is expected to under-perform the Outfront Media. But the preferred stock apears to be less risky and, when comparing its historical volatility, EPR Properties is 1.35 times less risky than Outfront Media. The preferred stock trades about -0.03 of its potential returns per unit of risk. The Outfront Media is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 1,772 in Outfront Media on August 27, 2024 and sell it today you would earn a total of 164.00 from holding Outfront Media or generate 9.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EPR Properties vs. Outfront Media
Performance |
| Timeline |
| EPR Properties |
| Outfront Media |
EPR Properties and Outfront Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EPR Properties and Outfront Media
The main advantage of trading using opposite EPR Properties and Outfront Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EPR Properties position performs unexpectedly, Outfront Media 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 Outfront Media will offset losses from the drop in Outfront Media's long position.| EPR Properties vs. EPR Properties | EPR Properties vs. Lexington Realty Trust | EPR Properties vs. Aquagold International | EPR Properties vs. Morningstar Unconstrained Allocation |
| Outfront Media vs. PotlatchDeltic Corp | Outfront Media vs. Gaming Leisure Properties | Outfront Media vs. Rayonier | Outfront Media vs. Weyerhaeuser |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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