Correlation Between Inventrust Properties and Macerich
Can any of the company-specific risk be diversified away by investing in both Inventrust Properties and Macerich 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 Inventrust Properties and Macerich into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inventrust Properties Corp and Macerich Company, you can compare the effects of market volatilities on Inventrust Properties and Macerich 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 Inventrust Properties with a short position of Macerich. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inventrust Properties and Macerich.
Diversification Opportunities for Inventrust Properties and Macerich
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Inventrust and Macerich is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Inventrust Properties Corp and Macerich Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macerich and Inventrust 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 Inventrust Properties Corp are associated (or correlated) with Macerich. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macerich has no effect on the direction of Inventrust Properties i.e., Inventrust Properties and Macerich go up and down completely randomly.
Pair Corralation between Inventrust Properties and Macerich
Considering the 90-day investment horizon Inventrust Properties is expected to generate 3.29 times less return on investment than Macerich. But when comparing it to its historical volatility, Inventrust Properties Corp is 2.01 times less risky than Macerich. It trades about 0.07 of its potential returns per unit of risk. Macerich Company is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 918.00 in Macerich Company on August 26, 2024 and sell it today you would earn a total of 1,054 from holding Macerich Company or generate 114.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inventrust Properties Corp vs. Macerich Company
Performance |
| Timeline |
| Inventrust Properties |
| Macerich |
Inventrust Properties and Macerich Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inventrust Properties and Macerich
The main advantage of trading using opposite Inventrust Properties and Macerich positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inventrust Properties position performs unexpectedly, Macerich 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 Macerich will offset losses from the drop in Macerich's long position.| Inventrust Properties vs. Urban Edge Properties | Inventrust Properties vs. Kite Realty Group | Inventrust Properties vs. Retail Opportunity Investments | Inventrust Properties vs. Acadia Realty Trust |
| Macerich vs. Site Centers Corp | Macerich vs. Inventrust Properties Corp | Macerich vs. Retail Opportunity Investments | Macerich vs. Netstreit Corp |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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