Correlation Between Plaza Retail and CT Real
Can any of the company-specific risk be diversified away by investing in both Plaza Retail and CT Real 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 Plaza Retail and CT Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Plaza Retail REIT and CT Real Estate, you can compare the effects of market volatilities on Plaza Retail and CT Real 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 Plaza Retail with a short position of CT Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Plaza Retail and CT Real.
Diversification Opportunities for Plaza Retail and CT Real
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Plaza and CTRRF is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Plaza Retail REIT and CT Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CT Real Estate and Plaza Retail 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 Plaza Retail REIT are associated (or correlated) with CT Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CT Real Estate has no effect on the direction of Plaza Retail i.e., Plaza Retail and CT Real go up and down completely randomly.
Pair Corralation between Plaza Retail and CT Real
Assuming the 90 days horizon Plaza Retail REIT is expected to generate 0.19 times more return on investment than CT Real. However, Plaza Retail REIT is 5.25 times less risky than CT Real. It trades about -0.27 of its potential returns per unit of risk. CT Real Estate is currently generating about -0.07 per unit of risk. If you would invest 292.00 in Plaza Retail REIT on August 28, 2024 and sell it today you would lose (22.00) from holding Plaza Retail REIT or give up 7.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Plaza Retail REIT vs. CT Real Estate
Performance |
| Timeline |
| Plaza Retail REIT |
| CT Real Estate |
Plaza Retail and CT Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Plaza Retail and CT Real
The main advantage of trading using opposite Plaza Retail and CT Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Plaza Retail position performs unexpectedly, CT Real 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 CT Real will offset losses from the drop in CT Real's long position.| Plaza Retail vs. Choice Properties Real | Plaza Retail vs. CT Real Estate | Plaza Retail vs. Firm Capital Property | Plaza Retail vs. Slate Grocery REIT |
| CT Real vs. Smart REIT | CT Real vs. Phillips Edison Co | CT Real vs. Simon Property Group | CT Real vs. Inventrust Properties 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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