Correlation Between STAG Industrial, and Charter Communications
Can any of the company-specific risk be diversified away by investing in both STAG Industrial, and Charter Communications 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 STAG Industrial, and Charter Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between STAG Industrial, and Charter Communications, you can compare the effects of market volatilities on STAG Industrial, and Charter Communications 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 STAG Industrial, with a short position of Charter Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of STAG Industrial, and Charter Communications.
Diversification Opportunities for STAG Industrial, and Charter Communications
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between STAG and Charter is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding STAG Industrial, and Charter Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Charter Communications and STAG Industrial, 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 STAG Industrial, are associated (or correlated) with Charter Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Charter Communications has no effect on the direction of STAG Industrial, i.e., STAG Industrial, and Charter Communications go up and down completely randomly.
Pair Corralation between STAG Industrial, and Charter Communications
Assuming the 90 days trading horizon STAG Industrial, is expected to generate 0.78 times more return on investment than Charter Communications. However, STAG Industrial, is 1.29 times less risky than Charter Communications. It trades about 0.03 of its potential returns per unit of risk. Charter Communications is currently generating about 0.01 per unit of risk. If you would invest 3,336 in STAG Industrial, on October 16, 2024 and sell it today you would earn a total of 668.00 from holding STAG Industrial, or generate 20.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.99% |
| Values | Daily Returns |
STAG Industrial, vs. Charter Communications
Performance |
| Timeline |
| STAG Industrial, |
| Charter Communications |
STAG Industrial, and Charter Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STAG Industrial, and Charter Communications
The main advantage of trading using opposite STAG Industrial, and Charter Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STAG Industrial, position performs unexpectedly, Charter Communications 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 Charter Communications will offset losses from the drop in Charter Communications' long position.| STAG Industrial, vs. Capital One Financial | STAG Industrial, vs. Synchrony Financial | STAG Industrial, vs. Ameriprise Financial | STAG Industrial, vs. CM Hospitalar SA |
| Charter Communications vs. STAG Industrial, | Charter Communications vs. METISA Metalrgica Timboense | Charter Communications vs. Burlington Stores, | Charter Communications vs. Ross Stores |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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