Correlation Between Urban Edge and Generation Income
Can any of the company-specific risk be diversified away by investing in both Urban Edge and Generation Income 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 Urban Edge and Generation Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Urban Edge Properties and Generation Income Properties, you can compare the effects of market volatilities on Urban Edge and Generation Income 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 Urban Edge with a short position of Generation Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Urban Edge and Generation Income.
Diversification Opportunities for Urban Edge and Generation Income
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Urban and Generation is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Urban Edge Properties and Generation Income Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Generation Income and Urban Edge 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 Urban Edge Properties are associated (or correlated) with Generation Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Generation Income has no effect on the direction of Urban Edge i.e., Urban Edge and Generation Income go up and down completely randomly.
Pair Corralation between Urban Edge and Generation Income
Allowing for the 90-day total investment horizon Urban Edge is expected to generate 188.5 times less return on investment than Generation Income. But when comparing it to its historical volatility, Urban Edge Properties is 96.88 times less risky than Generation Income. It trades about 0.07 of its potential returns per unit of risk. Generation Income Properties is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 41.00 in Generation Income Properties on August 30, 2024 and sell it today you would lose (23.00) from holding Generation Income Properties or give up 56.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 52.82% |
| Values | Daily Returns |
Urban Edge Properties vs. Generation Income Properties
Performance |
| Timeline |
| Urban Edge Properties |
| Generation Income |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
Urban Edge and Generation Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Urban Edge and Generation Income
The main advantage of trading using opposite Urban Edge and Generation Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Urban Edge position performs unexpectedly, Generation Income 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 Generation Income will offset losses from the drop in Generation Income's long position.| Urban Edge vs. Saul Centers | Urban Edge vs. Site Centers Corp | Urban Edge vs. Acadia Realty Trust | Urban Edge vs. Retail Opportunity Investments |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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