Correlation Between Tanger Factory and STAG Industrial
Can any of the company-specific risk be diversified away by investing in both Tanger Factory and STAG Industrial 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 STAG Industrial 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 STAG Industrial, you can compare the effects of market volatilities on Tanger Factory and STAG Industrial 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 STAG Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tanger Factory and STAG Industrial.
Diversification Opportunities for Tanger Factory and STAG Industrial
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Tanger and STAG is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Tanger Factory Outlet and STAG Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STAG Industrial 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 STAG Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STAG Industrial has no effect on the direction of Tanger Factory i.e., Tanger Factory and STAG Industrial go up and down completely randomly.
Pair Corralation between Tanger Factory and STAG Industrial
Considering the 90-day investment horizon Tanger Factory Outlet is expected to generate 1.19 times more return on investment than STAG Industrial. However, Tanger Factory is 1.19 times more volatile than STAG Industrial. It trades about 0.11 of its potential returns per unit of risk. STAG Industrial is currently generating about 0.02 per unit of risk. If you would invest 1,797 in Tanger Factory Outlet on August 27, 2024 and sell it today you would earn a total of 1,870 from holding Tanger Factory Outlet or generate 104.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tanger Factory Outlet vs. STAG Industrial
Performance |
| Timeline |
| Tanger Factory Outlet |
| STAG Industrial |
Tanger Factory and STAG Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tanger Factory and STAG Industrial
The main advantage of trading using opposite Tanger Factory and STAG Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tanger Factory position performs unexpectedly, STAG Industrial 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 STAG Industrial will offset losses from the drop in STAG Industrial's long position.| Tanger Factory vs. Regency Centers | Tanger Factory vs. Getty Realty | Tanger Factory vs. Site Centers Corp | Tanger Factory vs. Brixmor Property |
| STAG Industrial vs. Public Storage | STAG Industrial vs. Extra Space Storage | STAG Industrial vs. Rexford Industrial Realty | STAG Industrial vs. Innovative Industrial 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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