Correlation Between British Land and Regency Centers
Can any of the company-specific risk be diversified away by investing in both British Land and Regency Centers 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 British Land and Regency Centers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between British Land and Regency Centers, you can compare the effects of market volatilities on British Land and Regency Centers 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 British Land with a short position of Regency Centers. Check out your portfolio center. Please also check ongoing floating volatility patterns of British Land and Regency Centers.
Diversification Opportunities for British Land and Regency Centers
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between British and Regency is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding British Land and Regency Centers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regency Centers and British Land 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 British Land are associated (or correlated) with Regency Centers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regency Centers has no effect on the direction of British Land i.e., British Land and Regency Centers go up and down completely randomly.
Pair Corralation between British Land and Regency Centers
Assuming the 90 days horizon British Land is expected to generate 1.52 times more return on investment than Regency Centers. However, British Land is 1.52 times more volatile than Regency Centers. It trades about 0.13 of its potential returns per unit of risk. Regency Centers is currently generating about 0.02 per unit of risk. If you would invest 347.00 in British Land on January 20, 2024 and sell it today you would earn a total of 122.00 from holding British Land or generate 35.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
British Land vs. Regency Centers
Performance |
| Timeline |
| British Land |
| Regency Centers |
British Land and Regency Centers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with British Land and Regency Centers
The main advantage of trading using opposite British Land and Regency Centers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if British Land position performs unexpectedly, Regency Centers 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 Regency Centers will offset losses from the drop in Regency Centers' long position.| British Land vs. Modiv Inc | British Land vs. Gladstone Commercial Corp | British Land vs. NexPoint Strategic Opportunities | British Land vs. CTO Realty Growth |
| Regency Centers vs. Saul Centers | Regency Centers vs. Retail Opportunity Investments | Regency Centers vs. Getty Realty | Regency Centers vs. Site Centers Corp |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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