Correlation Between Industrial Logistics and Rexford Industrial
Can any of the company-specific risk be diversified away by investing in both Industrial Logistics and Rexford Industrial 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 Industrial Logistics and Rexford Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Industrial Logistics Properties and Rexford Industrial Realty, you can compare the effects of market volatilities on Industrial Logistics and Rexford Industrial 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 Industrial Logistics with a short position of Rexford Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial Logistics and Rexford Industrial.
Diversification Opportunities for Industrial Logistics and Rexford Industrial
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Industrial and Rexford is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Industrial Logistics Propertie and Rexford Industrial Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rexford Industrial Realty and Industrial Logistics 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 Industrial Logistics Properties are associated (or correlated) with Rexford Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rexford Industrial Realty has no effect on the direction of Industrial Logistics i.e., Industrial Logistics and Rexford Industrial go up and down completely randomly.
Pair Corralation between Industrial Logistics and Rexford Industrial
Given the investment horizon of 90 days Industrial Logistics Properties is expected to generate 1.66 times more return on investment than Rexford Industrial. However, Industrial Logistics is 1.66 times more volatile than Rexford Industrial Realty. It trades about 0.2 of its potential returns per unit of risk. Rexford Industrial Realty is currently generating about -0.06 per unit of risk. If you would invest 354.00 in Industrial Logistics Properties on September 1, 2024 and sell it today you would earn a total of 33.00 from holding Industrial Logistics Properties or generate 9.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial Logistics Propertie vs. Rexford Industrial Realty
Performance |
| Timeline |
| Industrial Logistics |
| Rexford Industrial Realty |
Industrial Logistics and Rexford Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial Logistics and Rexford Industrial
The main advantage of trading using opposite Industrial Logistics and Rexford Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial Logistics position performs unexpectedly, Rexford Industrial 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 Rexford Industrial will offset losses from the drop in Rexford Industrial's long position.| Industrial Logistics vs. Terreno Realty | Industrial Logistics vs. LXP Industrial Trust | Industrial Logistics vs. Rexford Industrial Realty | Industrial Logistics vs. First Industrial Realty |
| Rexford Industrial vs. Plymouth Industrial REIT | Rexford Industrial vs. EastGroup Properties | Rexford Industrial vs. LXP Industrial Trust | Rexford Industrial vs. Terreno Realty |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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