Correlation Between Four Corners and Gaming Leisure
Can any of the company-specific risk be diversified away by investing in both Four Corners and Gaming Leisure 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 Four Corners and Gaming Leisure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Four Corners Property and Gaming Leisure Properties, you can compare the effects of market volatilities on Four Corners and Gaming Leisure 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 Four Corners with a short position of Gaming Leisure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Four Corners and Gaming Leisure.
Diversification Opportunities for Four Corners and Gaming Leisure
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Four and Gaming is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Four Corners Property and Gaming Leisure Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaming Leisure Properties and Four Corners 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 Four Corners Property are associated (or correlated) with Gaming Leisure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaming Leisure Properties has no effect on the direction of Four Corners i.e., Four Corners and Gaming Leisure go up and down completely randomly.
Pair Corralation between Four Corners and Gaming Leisure
Given the investment horizon of 90 days Four Corners Property is expected to generate 0.79 times more return on investment than Gaming Leisure. However, Four Corners Property is 1.26 times less risky than Gaming Leisure. It trades about 0.18 of its potential returns per unit of risk. Gaming Leisure Properties is currently generating about 0.04 per unit of risk. If you would invest 2,834 in Four Corners Property on August 27, 2024 and sell it today you would earn a total of 91.00 from holding Four Corners Property or generate 3.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Four Corners Property vs. Gaming Leisure Properties
Performance |
| Timeline |
| Four Corners Property |
| Gaming Leisure Properties |
Four Corners and Gaming Leisure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Four Corners and Gaming Leisure
The main advantage of trading using opposite Four Corners and Gaming Leisure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Four Corners position performs unexpectedly, Gaming Leisure 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 Gaming Leisure will offset losses from the drop in Gaming Leisure's long position.| Four Corners vs. Broadstone Net Lease | Four Corners vs. Armada Hflr Pr | Four Corners vs. Brightspire Capital | Four Corners vs. Safehold |
| Gaming Leisure vs. VICI Properties | Gaming Leisure vs. Brixmor Property | Gaming Leisure vs. Sabra Healthcare REIT | Gaming Leisure vs. CubeSmart |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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