Correlation Between W P and Inland Real
Can any of the company-specific risk be diversified away by investing in both W P and Inland Real 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 W P and Inland Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between W P Carey and Inland Real Estateome, you can compare the effects of market volatilities on W P and Inland Real 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 W P with a short position of Inland Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of W P and Inland Real.
Diversification Opportunities for W P and Inland Real
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between WPC and Inland is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding W P Carey and Inland Real Estateome in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inland Real Estateome and W P 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 W P Carey are associated (or correlated) with Inland Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inland Real Estateome has no effect on the direction of W P i.e., W P and Inland Real go up and down completely randomly.
Pair Corralation between W P and Inland Real
Considering the 90-day investment horizon W P Carey is expected to under-perform the Inland Real. But the stock apears to be less risky and, when comparing its historical volatility, W P Carey is 1.34 times less risky than Inland Real. The stock trades about 0.0 of its potential returns per unit of risk. The Inland Real Estateome is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,143 in Inland Real Estateome on August 26, 2024 and sell it today you would lose (43.00) from holding Inland Real Estateome or give up 3.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
W P Carey vs. Inland Real Estateome
Performance |
| Timeline |
| W P Carey |
| Inland Real Estateome |
W P and Inland Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with W P and Inland Real
The main advantage of trading using opposite W P and Inland Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if W P position performs unexpectedly, Inland Real 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 Inland Real will offset losses from the drop in Inland Real's long position.| W P vs. STAG Industrial | W P vs. National Retail Properties | W P vs. Medical Properties Trust | W P vs. Omega Healthcare Investors |
| Inland Real vs. Global Net Lease, | Inland Real vs. Brightspire Capital | Inland Real vs. NexPoint Strategic Opportunities |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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