Correlation Between Riocan REIT and Urban Edge
Can any of the company-specific risk be diversified away by investing in both Riocan REIT and Urban Edge 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 Riocan REIT and Urban Edge into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Riocan REIT and Urban Edge Properties, you can compare the effects of market volatilities on Riocan REIT and Urban Edge 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 Riocan REIT with a short position of Urban Edge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Riocan REIT and Urban Edge.
Diversification Opportunities for Riocan REIT and Urban Edge
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Riocan and Urban is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Riocan REIT and Urban Edge Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Urban Edge Properties and Riocan REIT 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 Riocan REIT are associated (or correlated) with Urban Edge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Urban Edge Properties has no effect on the direction of Riocan REIT i.e., Riocan REIT and Urban Edge go up and down completely randomly.
Pair Corralation between Riocan REIT and Urban Edge
Assuming the 90 days horizon Riocan REIT is expected to under-perform the Urban Edge. But the pink sheet apears to be less risky and, when comparing its historical volatility, Riocan REIT is 1.11 times less risky than Urban Edge. The pink sheet trades about -0.03 of its potential returns per unit of risk. The Urban Edge Properties is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 2,216 in Urban Edge Properties on August 28, 2024 and sell it today you would earn a total of 97.00 from holding Urban Edge Properties or generate 4.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Riocan REIT vs. Urban Edge Properties
Performance |
| Timeline |
| Riocan REIT |
| Urban Edge Properties |
Riocan REIT and Urban Edge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Riocan REIT and Urban Edge
The main advantage of trading using opposite Riocan REIT and Urban Edge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Riocan REIT position performs unexpectedly, Urban Edge 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 Urban Edge will offset losses from the drop in Urban Edge's long position.| Riocan REIT vs. Choice Properties Real | Riocan REIT vs. CT Real Estate | Riocan REIT vs. Firm Capital Property | Riocan REIT vs. Slate Grocery REIT |
| Urban Edge vs. Saul Centers | Urban Edge vs. Site Centers Corp | Urban Edge vs. Kite Realty Group | Urban Edge vs. Retail Opportunity Investments |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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