Correlation Between Retail Estates and Gladstone Commercial
Can any of the company-specific risk be diversified away by investing in both Retail Estates and Gladstone Commercial 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 Retail Estates and Gladstone Commercial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Retail Estates NV and Gladstone Commercial, you can compare the effects of market volatilities on Retail Estates and Gladstone Commercial 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 Retail Estates with a short position of Gladstone Commercial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Retail Estates and Gladstone Commercial.
Diversification Opportunities for Retail Estates and Gladstone Commercial
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Retail and Gladstone is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Retail Estates NV and Gladstone Commercial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gladstone Commercial and Retail Estates 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 Retail Estates NV are associated (or correlated) with Gladstone Commercial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gladstone Commercial has no effect on the direction of Retail Estates i.e., Retail Estates and Gladstone Commercial go up and down completely randomly.
Pair Corralation between Retail Estates and Gladstone Commercial
Assuming the 90 days horizon Retail Estates NV is expected to under-perform the Gladstone Commercial. But the stock apears to be less risky and, when comparing its historical volatility, Retail Estates NV is 1.85 times less risky than Gladstone Commercial. The stock trades about -0.22 of its potential returns per unit of risk. The Gladstone Commercial is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,552 in Gladstone Commercial on November 4, 2024 and sell it today you would earn a total of 29.00 from holding Gladstone Commercial or generate 1.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Retail Estates NV vs. Gladstone Commercial
Performance |
| Timeline |
| Retail Estates NV |
| Gladstone Commercial |
Retail Estates and Gladstone Commercial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Retail Estates and Gladstone Commercial
The main advantage of trading using opposite Retail Estates and Gladstone Commercial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Retail Estates position performs unexpectedly, Gladstone Commercial 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 Gladstone Commercial will offset losses from the drop in Gladstone Commercial's long position.| Retail Estates vs. INTERNET INJPADR 1 | Retail Estates vs. Yuexiu Transport Infrastructure | Retail Estates vs. Highlight Communications AG | Retail Estates vs. TELECOM ITALRISP ADR10 |
| Gladstone Commercial vs. PARKEN Sport Entertainment | Gladstone Commercial vs. Jacquet Metal Service | Gladstone Commercial vs. NorAm Drilling AS | Gladstone Commercial vs. COSMOSTEEL HLDGS |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |