Correlation Between STAG Industrial and Gladstone Land
Can any of the company-specific risk be diversified away by investing in both STAG Industrial and Gladstone Land 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 Land 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 Land, you can compare the effects of market volatilities on STAG Industrial and Gladstone Land 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 Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of STAG Industrial and Gladstone Land.
Diversification Opportunities for STAG Industrial and Gladstone Land
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between STAG and Gladstone is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding STAG Industrial and Gladstone Land in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gladstone Land 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 Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gladstone Land has no effect on the direction of STAG Industrial i.e., STAG Industrial and Gladstone Land go up and down completely randomly.
Pair Corralation between STAG Industrial and Gladstone Land
Given the investment horizon of 90 days STAG Industrial is expected to generate 0.79 times more return on investment than Gladstone Land. However, STAG Industrial is 1.26 times less risky than Gladstone Land. It trades about -0.09 of its potential returns per unit of risk. Gladstone Land is currently generating about -0.28 per unit of risk. If you would invest 3,736 in STAG Industrial on August 27, 2024 and sell it today you would lose (88.00) from holding STAG Industrial or give up 2.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
STAG Industrial vs. Gladstone Land
Performance |
| Timeline |
| STAG Industrial |
| Gladstone Land |
STAG Industrial and Gladstone Land Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STAG Industrial and Gladstone Land
The main advantage of trading using opposite STAG Industrial and Gladstone Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STAG Industrial position performs unexpectedly, Gladstone Land 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 Land will offset losses from the drop in Gladstone Land'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 Land vs. Farmland Partners | Gladstone Land vs. STAG Industrial | Gladstone Land vs. Gladstone Commercial | Gladstone Land vs. LTC 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |