Correlation Between Tanger Factory and Four Corners
Can any of the company-specific risk be diversified away by investing in both Tanger Factory and Four Corners 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 Tanger Factory and Four Corners into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tanger Factory Outlet and Four Corners Property, you can compare the effects of market volatilities on Tanger Factory and Four Corners 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 Tanger Factory with a short position of Four Corners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tanger Factory and Four Corners.
Diversification Opportunities for Tanger Factory and Four Corners
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tanger and Four is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Tanger Factory Outlet and Four Corners Property in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Four Corners Property and Tanger Factory 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 Tanger Factory Outlet are associated (or correlated) with Four Corners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Four Corners Property has no effect on the direction of Tanger Factory i.e., Tanger Factory and Four Corners go up and down completely randomly.
Pair Corralation between Tanger Factory and Four Corners
Considering the 90-day investment horizon Tanger Factory Outlet is expected to generate 1.22 times more return on investment than Four Corners. However, Tanger Factory is 1.22 times more volatile than Four Corners Property. It trades about 0.11 of its potential returns per unit of risk. Four Corners Property is currently generating about 0.05 per unit of risk. If you would invest 2,064 in Tanger Factory Outlet on August 31, 2024 and sell it today you would earn a total of 1,633 from holding Tanger Factory Outlet or generate 79.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tanger Factory Outlet vs. Four Corners Property
Performance |
| Timeline |
| Tanger Factory Outlet |
| Four Corners Property |
Tanger Factory and Four Corners Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tanger Factory and Four Corners
The main advantage of trading using opposite Tanger Factory and Four Corners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tanger Factory position performs unexpectedly, Four Corners 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 Four Corners will offset losses from the drop in Four Corners' long position.| Tanger Factory vs. Federal Realty Investment | Tanger Factory vs. Macerich Company | Tanger Factory vs. National Retail Properties | Tanger Factory vs. Kimco Realty |
| Four Corners vs. Alpineome Property Trust | Four Corners vs. Kite Realty Group | Four Corners vs. Inventrust Properties Corp | Four Corners vs. Kimco Realty |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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