Correlation Between NYSE Composite and EastGroup Properties
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and EastGroup Properties 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 NYSE Composite and EastGroup Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and EastGroup Properties, you can compare the effects of market volatilities on NYSE Composite and EastGroup Properties 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 NYSE Composite with a short position of EastGroup Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and EastGroup Properties.
Diversification Opportunities for NYSE Composite and EastGroup Properties
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NYSE and EastGroup is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and EastGroup Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EastGroup Properties and NYSE Composite 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 NYSE Composite are associated (or correlated) with EastGroup Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EastGroup Properties has no effect on the direction of NYSE Composite i.e., NYSE Composite and EastGroup Properties go up and down completely randomly.
Pair Corralation between NYSE Composite and EastGroup Properties
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.62 times more return on investment than EastGroup Properties. However, NYSE Composite is 1.61 times less risky than EastGroup Properties. It trades about 0.14 of its potential returns per unit of risk. EastGroup Properties is currently generating about 0.06 per unit of risk. If you would invest 1,800,696 in NYSE Composite on August 30, 2024 and sell it today you would earn a total of 220,286 from holding NYSE Composite or generate 12.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. EastGroup Properties
Performance |
| Timeline |
NYSE Composite and EastGroup Properties Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
EastGroup Properties
Pair trading matchups for EastGroup Properties
Pair Trading with NYSE Composite and EastGroup Properties
The main advantage of trading using opposite NYSE Composite and EastGroup Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, EastGroup Properties 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 EastGroup Properties will offset losses from the drop in EastGroup Properties' long position.| NYSE Composite vs. Delek Drilling | NYSE Composite vs. Helmerich and Payne | NYSE Composite vs. Waste Management | NYSE Composite vs. US Global Investors |
| EastGroup Properties vs. Terreno Realty | EastGroup Properties vs. Plymouth Industrial REIT | EastGroup Properties vs. LXP Industrial Trust | EastGroup Properties vs. First Industrial 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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