Correlation Between Urban Edge and SL Green
Can any of the company-specific risk be diversified away by investing in both Urban Edge and SL Green 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 SL Green 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 SL Green Realty, you can compare the effects of market volatilities on Urban Edge and SL Green 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 SL Green. Check out your portfolio center. Please also check ongoing floating volatility patterns of Urban Edge and SL Green.
Diversification Opportunities for Urban Edge and SL Green
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Urban and SLG is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Urban Edge Properties and SL Green Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SL Green Realty 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 SL Green. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SL Green Realty has no effect on the direction of Urban Edge i.e., Urban Edge and SL Green go up and down completely randomly.
Pair Corralation between Urban Edge and SL Green
Allowing for the 90-day total investment horizon Urban Edge Properties is expected to generate 0.72 times more return on investment than SL Green. However, Urban Edge Properties is 1.38 times less risky than SL Green. It trades about -0.11 of its potential returns per unit of risk. SL Green Realty is currently generating about -0.14 per unit of risk. If you would invest 2,262 in Urban Edge Properties on December 6, 2024 and sell it today you would lose (224.00) from holding Urban Edge Properties or give up 9.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Urban Edge Properties vs. SL Green Realty
Performance |
| Timeline |
| Urban Edge Properties |
| SL Green Realty |
Urban Edge and SL Green Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Urban Edge and SL Green
The main advantage of trading using opposite Urban Edge and SL Green positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Urban Edge position performs unexpectedly, SL Green 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 SL Green will offset losses from the drop in SL Green's long position.| Urban Edge vs. Saul Centers | Urban Edge vs. Rithm Property Trust | Urban Edge vs. Site Centers Corp | Urban Edge vs. Kite Realty Group |
| SL Green vs. Boston Properties | SL Green vs. Douglas Emmett | SL Green vs. Kilroy Realty Corp | SL Green vs. Alexandria Real Estate |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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