Correlation Between Phillips Edison and Land Securities
Can any of the company-specific risk be diversified away by investing in both Phillips Edison and Land Securities 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 Phillips Edison and Land Securities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Phillips Edison Co and Land Securities Group, you can compare the effects of market volatilities on Phillips Edison and Land Securities 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 Phillips Edison with a short position of Land Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phillips Edison and Land Securities.
Diversification Opportunities for Phillips Edison and Land Securities
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Phillips and Land is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Phillips Edison Co and Land Securities Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Land Securities Group and Phillips Edison 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 Phillips Edison Co are associated (or correlated) with Land Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Land Securities Group has no effect on the direction of Phillips Edison i.e., Phillips Edison and Land Securities go up and down completely randomly.
Pair Corralation between Phillips Edison and Land Securities
Given the investment horizon of 90 days Phillips Edison is expected to generate 1.59 times less return on investment than Land Securities. But when comparing it to its historical volatility, Phillips Edison Co is 3.38 times less risky than Land Securities. It trades about 0.05 of its potential returns per unit of risk. Land Securities Group is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 743.00 in Land Securities Group on August 27, 2024 and sell it today you would lose (1.00) from holding Land Securities Group or give up 0.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 70.56% |
| Values | Daily Returns |
Phillips Edison Co vs. Land Securities Group
Performance |
| Timeline |
| Phillips Edison |
| Land Securities Group |
Phillips Edison and Land Securities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Phillips Edison and Land Securities
The main advantage of trading using opposite Phillips Edison and Land Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Phillips Edison position performs unexpectedly, Land Securities 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 Land Securities will offset losses from the drop in Land Securities' long position.| Phillips Edison vs. Site Centers Corp | Phillips Edison vs. Retail Opportunity Investments | Phillips Edison vs. Urban Edge Properties | Phillips Edison vs. Netstreit Corp |
| Land Securities vs. Land Securities Group | Land Securities vs. British Land | Land Securities vs. British Land | Land Securities vs. Taylor Wimpey PLC |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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