Correlation Between STAG Industrial and Gladstone Commercial
Can any of the company-specific risk be diversified away by investing in both STAG Industrial and Gladstone Commercial 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 STAG Industrial and Gladstone Commercial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between STAG Industrial and Gladstone Commercial, you can compare the effects of market volatilities on STAG Industrial and Gladstone Commercial 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 STAG Industrial with a short position of Gladstone Commercial. Check out your portfolio center. Please also check ongoing floating volatility patterns of STAG Industrial and Gladstone Commercial.
Diversification Opportunities for STAG Industrial and Gladstone Commercial
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between STAG and Gladstone is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding STAG Industrial and Gladstone Commercial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gladstone Commercial and STAG Industrial 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 STAG Industrial are associated (or correlated) with Gladstone Commercial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gladstone Commercial has no effect on the direction of STAG Industrial i.e., STAG Industrial and Gladstone Commercial go up and down completely randomly.
Pair Corralation between STAG Industrial and Gladstone Commercial
Given the investment horizon of 90 days STAG Industrial is expected to generate 1.37 times more return on investment than Gladstone Commercial. However, STAG Industrial is 1.37 times more volatile than Gladstone Commercial. It trades about 0.15 of its potential returns per unit of risk. Gladstone Commercial is currently generating about 0.03 per unit of risk. If you would invest 3,300 in STAG Industrial on November 2, 2024 and sell it today you would earn a total of 147.00 from holding STAG Industrial or generate 4.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
STAG Industrial vs. Gladstone Commercial
Performance |
| Timeline |
| STAG Industrial |
| Gladstone Commercial |
STAG Industrial and Gladstone Commercial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STAG Industrial and Gladstone Commercial
The main advantage of trading using opposite STAG Industrial and Gladstone Commercial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STAG Industrial position performs unexpectedly, Gladstone Commercial 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 Gladstone Commercial will offset losses from the drop in Gladstone Commercial's long position.| STAG Industrial vs. Public Storage | STAG Industrial vs. Extra Space Storage | STAG Industrial vs. Rexford Industrial Realty | STAG Industrial vs. Innovative Industrial Properties |
| Gladstone Commercial vs. Gladstone Investment | Gladstone Commercial vs. Gladstone Capital | Gladstone Commercial vs. LTC Properties | Gladstone Commercial vs. Dynex Capital |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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