Correlation Between TPG RE and Sila Realty
Can any of the company-specific risk be diversified away by investing in both TPG RE and Sila Realty 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 TPG RE and Sila Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TPG RE Finance and Sila Realty Trust,, you can compare the effects of market volatilities on TPG RE and Sila Realty 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 TPG RE with a short position of Sila Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of TPG RE and Sila Realty.
Diversification Opportunities for TPG RE and Sila Realty
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between TPG and Sila is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding TPG RE Finance and Sila Realty Trust, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sila Realty Trust, and TPG RE 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 TPG RE Finance are associated (or correlated) with Sila Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sila Realty Trust, has no effect on the direction of TPG RE i.e., TPG RE and Sila Realty go up and down completely randomly.
Pair Corralation between TPG RE and Sila Realty
Assuming the 90 days trading horizon TPG RE is expected to generate 1.12 times less return on investment than Sila Realty. But when comparing it to its historical volatility, TPG RE Finance is 1.57 times less risky than Sila Realty. It trades about 0.13 of its potential returns per unit of risk. Sila Realty Trust, is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 2,207 in Sila Realty Trust, on August 30, 2024 and sell it today you would earn a total of 420.00 from holding Sila Realty Trust, or generate 19.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 93.65% |
| Values | Daily Returns |
TPG RE Finance vs. Sila Realty Trust,
Performance |
| Timeline |
| TPG RE Finance |
| Sila Realty Trust, |
TPG RE and Sila Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TPG RE and Sila Realty
The main advantage of trading using opposite TPG RE and Sila Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TPG RE position performs unexpectedly, Sila Realty 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 Sila Realty will offset losses from the drop in Sila Realty's long position.| TPG RE vs. ACRES Commercial Realty | TPG RE vs. Dynex Capital | TPG RE vs. PennyMac Mortgage Investment | TPG RE vs. AG Mortgage Investment |
| Sila Realty vs. Northstar Clean Technologies | Sila Realty vs. Asure Software | Sila Realty vs. United Guardian | Sila Realty vs. Old Dominion Freight |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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