Correlation Between Urban Edge and Global Net
Can any of the company-specific risk be diversified away by investing in both Urban Edge and Global Net 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 Global Net 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 Global Net Lease, you can compare the effects of market volatilities on Urban Edge and Global Net 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 Global Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of Urban Edge and Global Net.
Diversification Opportunities for Urban Edge and Global Net
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Urban and Global is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Urban Edge Properties and Global Net Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Net Lease 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 Global Net. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Net Lease has no effect on the direction of Urban Edge i.e., Urban Edge and Global Net go up and down completely randomly.
Pair Corralation between Urban Edge and Global Net
Allowing for the 90-day total investment horizon Urban Edge Properties is expected to generate 1.09 times more return on investment than Global Net. However, Urban Edge is 1.09 times more volatile than Global Net Lease. It trades about 0.17 of its potential returns per unit of risk. Global Net Lease is currently generating about -0.02 per unit of risk. If you would invest 2,195 in Urban Edge Properties on August 24, 2024 and sell it today you would earn a total of 100.00 from holding Urban Edge Properties or generate 4.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Urban Edge Properties vs. Global Net Lease
Performance |
| Timeline |
| Urban Edge Properties |
| Global Net Lease |
Urban Edge and Global Net Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Urban Edge and Global Net
The main advantage of trading using opposite Urban Edge and Global Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Urban Edge position performs unexpectedly, Global Net 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 Global Net will offset losses from the drop in Global Net's long position.| Urban Edge vs. Site Centers Corp | Urban Edge vs. Kite Realty Group | Urban Edge vs. Retail Opportunity Investments | Urban Edge vs. Inventrust Properties Corp |
| Global Net vs. Modiv Inc | Global Net vs. Precinct Properties New | Global Net vs. Global Net Lease | Global Net vs. NexPoint Diversified Real |
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 Stocks Directory module to find actively traded stocks across global markets.
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