Correlation Between Macerich and Site Centers
Can any of the company-specific risk be diversified away by investing in both Macerich and Site Centers 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 Macerich and Site Centers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macerich Company and Site Centers Corp, you can compare the effects of market volatilities on Macerich and Site Centers 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 Macerich with a short position of Site Centers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macerich and Site Centers.
Diversification Opportunities for Macerich and Site Centers
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Macerich and Site is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Macerich Company and Site Centers Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Site Centers Corp and Macerich 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 Macerich Company are associated (or correlated) with Site Centers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Site Centers Corp has no effect on the direction of Macerich i.e., Macerich and Site Centers go up and down completely randomly.
Pair Corralation between Macerich and Site Centers
Considering the 90-day investment horizon Macerich is expected to generate 1.02 times less return on investment than Site Centers. But when comparing it to its historical volatility, Macerich Company is 1.14 times less risky than Site Centers. It trades about 0.07 of its potential returns per unit of risk. Site Centers Corp is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 978.00 in Site Centers Corp on August 26, 2024 and sell it today you would earn a total of 632.00 from holding Site Centers Corp or generate 64.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Macerich Company vs. Site Centers Corp
Performance |
| Timeline |
| Macerich |
| Site Centers Corp |
Macerich and Site Centers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macerich and Site Centers
The main advantage of trading using opposite Macerich and Site Centers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macerich position performs unexpectedly, Site Centers 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 Site Centers will offset losses from the drop in Site Centers' long position.| Macerich vs. Site Centers Corp | Macerich vs. Inventrust Properties Corp | Macerich vs. Retail Opportunity Investments | Macerich vs. Netstreit Corp |
| Site Centers vs. Saul Centers | Site Centers vs. Acadia Realty Trust | Site Centers vs. Kite Realty Group | Site Centers vs. Retail Opportunity Investments |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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