Correlation Between Safehold and Farmland Partners
Can any of the company-specific risk be diversified away by investing in both Safehold and Farmland Partners 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 Safehold and Farmland Partners into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Safehold and Farmland Partners, you can compare the effects of market volatilities on Safehold and Farmland Partners 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 Safehold with a short position of Farmland Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Safehold and Farmland Partners.
Diversification Opportunities for Safehold and Farmland Partners
-0.89 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Safehold and Farmland is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding Safehold and Farmland Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Farmland Partners and Safehold 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 Safehold are associated (or correlated) with Farmland Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Farmland Partners has no effect on the direction of Safehold i.e., Safehold and Farmland Partners go up and down completely randomly.
Pair Corralation between Safehold and Farmland Partners
Given the investment horizon of 90 days Safehold is expected to under-perform the Farmland Partners. In addition to that, Safehold is 1.16 times more volatile than Farmland Partners. It trades about -0.1 of its total potential returns per unit of risk. Farmland Partners is currently generating about 0.35 per unit of volatility. If you would invest 1,100 in Farmland Partners on August 30, 2024 and sell it today you would earn a total of 166.00 from holding Farmland Partners or generate 15.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Safehold vs. Farmland Partners
Performance |
| Timeline |
| Safehold |
| Farmland Partners |
Safehold and Farmland Partners Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Safehold and Farmland Partners
The main advantage of trading using opposite Safehold and Farmland Partners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Safehold position performs unexpectedly, Farmland Partners 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 Farmland Partners will offset losses from the drop in Farmland Partners' long position.| Safehold vs. Essential Properties Realty | Safehold vs. Broadstone Net Lease | Safehold vs. Armada Hflr Pr | Safehold vs. CTO Realty Growth |
| Farmland Partners vs. PotlatchDeltic Corp | Farmland Partners vs. Weyerhaeuser | Farmland Partners vs. Outfront Media | Farmland Partners vs. Gaming Leisure Properties |
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.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |