Correlation Between Wheeler Real and Realty Income
Can any of the company-specific risk be diversified away by investing in both Wheeler Real and Realty 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 Wheeler Real and Realty Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wheeler Real Estate and Realty Income, you can compare the effects of market volatilities on Wheeler Real and Realty 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 Wheeler Real with a short position of Realty Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wheeler Real and Realty Income.
Diversification Opportunities for Wheeler Real and Realty Income
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Wheeler and Realty is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Wheeler Real Estate and Realty Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Realty Income and Wheeler Real 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 Wheeler Real Estate are associated (or correlated) with Realty Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Realty Income has no effect on the direction of Wheeler Real i.e., Wheeler Real and Realty Income go up and down completely randomly.
Pair Corralation between Wheeler Real and Realty Income
Given the investment horizon of 90 days Wheeler Real Estate is expected to under-perform the Realty Income. In addition to that, Wheeler Real is 7.13 times more volatile than Realty Income. It trades about -0.34 of its total potential returns per unit of risk. Realty Income is currently generating about 0.14 per unit of volatility. If you would invest 5,260 in Realty Income on November 3, 2024 and sell it today you would earn a total of 204.00 from holding Realty Income or generate 3.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wheeler Real Estate vs. Realty Income
Performance |
| Timeline |
| Wheeler Real Estate |
| Realty Income |
Wheeler Real and Realty Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wheeler Real and Realty Income
The main advantage of trading using opposite Wheeler Real and Realty Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wheeler Real position performs unexpectedly, Realty 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 Realty Income will offset losses from the drop in Realty Income's long position.| Wheeler Real vs. CBL Associates Properties | Wheeler Real vs. Cedar Realty Trust | Wheeler Real vs. Macerich Company | Wheeler Real vs. Simon Property Group |
| Realty Income vs. Federal Realty Investment | Realty Income vs. Macerich Company | Realty Income vs. National Retail Properties | Realty Income vs. Kimco Realty |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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