Correlation Between Tanger Factory and Wheeler Real
Can any of the company-specific risk be diversified away by investing in both Tanger Factory and Wheeler Real 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 Wheeler Real 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 Wheeler Real Estate, you can compare the effects of market volatilities on Tanger Factory and Wheeler Real 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 Wheeler Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tanger Factory and Wheeler Real.
Diversification Opportunities for Tanger Factory and Wheeler Real
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tanger and Wheeler is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Tanger Factory Outlet and Wheeler Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wheeler Real Estate 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 Wheeler Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wheeler Real Estate has no effect on the direction of Tanger Factory i.e., Tanger Factory and Wheeler Real go up and down completely randomly.
Pair Corralation between Tanger Factory and Wheeler Real
Considering the 90-day investment horizon Tanger Factory is expected to generate 2.44 times less return on investment than Wheeler Real. But when comparing it to its historical volatility, Tanger Factory Outlet is 18.11 times less risky than Wheeler Real. It trades about 0.12 of its potential returns per unit of risk. Wheeler Real Estate is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 23,040 in Wheeler Real Estate on August 27, 2024 and sell it today you would lose (22,190) from holding Wheeler Real Estate or give up 96.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tanger Factory Outlet vs. Wheeler Real Estate
Performance |
| Timeline |
| Tanger Factory Outlet |
| Wheeler Real Estate |
Tanger Factory and Wheeler Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tanger Factory and Wheeler Real
The main advantage of trading using opposite Tanger Factory and Wheeler Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tanger Factory position performs unexpectedly, Wheeler Real 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 Wheeler Real will offset losses from the drop in Wheeler Real's long position.| Tanger Factory vs. Regency Centers | Tanger Factory vs. Getty Realty | Tanger Factory vs. Site Centers Corp | Tanger Factory vs. Brixmor Property |
| Wheeler Real vs. CBL Associates Properties | Wheeler Real vs. Cedar Realty Trust | Wheeler Real vs. Macerich Company | Wheeler Real vs. Simon Property Group |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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