Correlation Between Prologis and Segro Plc
Can any of the company-specific risk be diversified away by investing in both Prologis and Segro Plc 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 Prologis and Segro Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prologis and Segro Plc, you can compare the effects of market volatilities on Prologis and Segro Plc 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 Prologis with a short position of Segro Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prologis and Segro Plc.
Diversification Opportunities for Prologis and Segro Plc
Very poor diversification
The 3 months correlation between Prologis and Segro is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Prologis and Segro Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Segro Plc and Prologis 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 Prologis are associated (or correlated) with Segro Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Segro Plc has no effect on the direction of Prologis i.e., Prologis and Segro Plc go up and down completely randomly.
Pair Corralation between Prologis and Segro Plc
Considering the 90-day investment horizon Prologis is expected to generate 0.41 times more return on investment than Segro Plc. However, Prologis is 2.47 times less risky than Segro Plc. It trades about 0.11 of its potential returns per unit of risk. Segro Plc is currently generating about -0.02 per unit of risk. If you would invest 11,340 in Prologis on September 2, 2024 and sell it today you would earn a total of 338.00 from holding Prologis or generate 2.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prologis vs. Segro Plc
Performance |
| Timeline |
| Prologis |
| Segro Plc |
Prologis and Segro Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prologis and Segro Plc
The main advantage of trading using opposite Prologis and Segro Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prologis position performs unexpectedly, Segro Plc 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 Segro Plc will offset losses from the drop in Segro Plc's long position.| Prologis vs. Extra Space Storage | Prologis vs. CubeSmart | Prologis vs. STAG Industrial | Prologis vs. Innovative Industrial Properties |
| Segro Plc vs. LXP Industrial Trust | Segro Plc vs. Plymouth Industrial REIT | Segro Plc vs. EastGroup Properties | Segro Plc vs. Americold Realty Trust |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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