Correlation Between Site Centers and First Trust
Can any of the company-specific risk be diversified away by investing in both Site Centers and First Trust 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 Site Centers and First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Site Centers Corp and First Trust SP, you can compare the effects of market volatilities on Site Centers and First Trust 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 Site Centers with a short position of First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Site Centers and First Trust.
Diversification Opportunities for Site Centers and First Trust
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Site and First is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Site Centers Corp and First Trust SP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust SP and Site Centers 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 Site Centers Corp are associated (or correlated) with First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust SP has no effect on the direction of Site Centers i.e., Site Centers and First Trust go up and down completely randomly.
Pair Corralation between Site Centers and First Trust
Given the investment horizon of 90 days Site Centers Corp is expected to under-perform the First Trust. In addition to that, Site Centers is 1.59 times more volatile than First Trust SP. It trades about -0.17 of its total potential returns per unit of risk. First Trust SP is currently generating about 0.1 per unit of volatility. If you would invest 2,940 in First Trust SP on August 29, 2024 and sell it today you would earn a total of 59.00 from holding First Trust SP or generate 2.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Site Centers Corp vs. First Trust SP
Performance |
| Timeline |
| Site Centers Corp |
| First Trust SP |
Site Centers and First Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Site Centers and First Trust
The main advantage of trading using opposite Site Centers and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Site Centers position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.| Site Centers vs. Saul Centers | Site Centers vs. Acadia Realty Trust | Site Centers vs. Kite Realty Group | Site Centers vs. Retail Opportunity Investments |
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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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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