Correlation Between Gladstone Land and Gladstone Commercial
Can any of the company-specific risk be diversified away by investing in both Gladstone Land and Gladstone Commercial 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 Gladstone Land and Gladstone Commercial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gladstone Land Corp and Gladstone Commercial Corp, you can compare the effects of market volatilities on Gladstone Land and Gladstone Commercial 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 Gladstone Land with a short position of Gladstone Commercial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gladstone Land and Gladstone Commercial.
Diversification Opportunities for Gladstone Land and Gladstone Commercial
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Gladstone and Gladstone is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Gladstone Land Corp and Gladstone Commercial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gladstone Commercial Corp and Gladstone Land 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 Gladstone Land Corp are associated (or correlated) with Gladstone Commercial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gladstone Commercial Corp has no effect on the direction of Gladstone Land i.e., Gladstone Land and Gladstone Commercial go up and down completely randomly.
Pair Corralation between Gladstone Land and Gladstone Commercial
Assuming the 90 days horizon Gladstone Land Corp is expected to generate 0.21 times more return on investment than Gladstone Commercial. However, Gladstone Land Corp is 4.81 times less risky than Gladstone Commercial. It trades about 0.2 of its potential returns per unit of risk. Gladstone Commercial Corp is currently generating about -0.01 per unit of risk. If you would invest 2,458 in Gladstone Land Corp on November 9, 2024 and sell it today you would earn a total of 20.00 from holding Gladstone Land Corp or generate 0.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gladstone Land Corp vs. Gladstone Commercial Corp
Performance |
| Timeline |
| Gladstone Land Corp |
| Gladstone Commercial Corp |
Gladstone Land and Gladstone Commercial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gladstone Land and Gladstone Commercial
The main advantage of trading using opposite Gladstone Land and Gladstone Commercial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gladstone Land position performs unexpectedly, Gladstone Commercial 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 Gladstone Commercial will offset losses from the drop in Gladstone Commercial's long position.| Gladstone Land vs. EPR Properties | Gladstone Land vs. Digital Realty Trust | Gladstone Land vs. EPR Properties Series | Gladstone Land vs. Digital Realty Trust |
| Gladstone Commercial vs. Gladstone Commercial Corp | Gladstone Commercial vs. AGNC Investment Corp | Gladstone Commercial vs. AGNC Investment Corp | Gladstone Commercial vs. AGNC Investment 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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