Correlation Between EPR Properties and Link Real

Can any of the company-specific risk be diversified away by investing in both EPR Properties and Link 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 EPR Properties and Link Real into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between EPR Properties and Link Real Estate, you can compare the effects of market volatilities on EPR Properties and Link 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 EPR Properties with a short position of Link Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of EPR Properties and Link Real.

Diversification Opportunities for EPR Properties and Link Real

0.75

Correlation Coefficient

EPR Properties  Link Real

Poor diversification

The 3 months correlation between EPR and Link is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding EPR Properties and Link Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Link Real Estate and EPR Properties 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 EPR Properties are associated (or correlated) with Link Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Link Real Estate has no effect on the direction of EPR Properties i.e., EPR Properties and Link Real go up and down completely randomly.

Pair Corralation between EPR Properties and Link Real

Considering the 90-day investment horizon EPR Properties is expected to generate 1.03 times less return on investment than Link Real. But when comparing it to its historical volatility, EPR Properties is 2.99 times less risky than Link Real. It trades about 0.26 of its potential returns per unit of risk. Link Real Estate is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  461.00  in Link Real Estate on April 25, 2025 and sell it today you would earn a total of  77.00  from holding Link Real Estate or generate 16.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.39%
Values	Daily Returns

EPR Properties  vs.  Link Real Estate

EPR Properties

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in EPR Properties are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent basic indicators, EPR Properties reported solid returns over the last few months and may actually be approaching a breakup point.

Link Real Estate

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Link Real Estate are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical and fundamental indicators, Link Real reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with EPR Properties and Link Real

The main advantage of trading using opposite EPR Properties and Link Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EPR Properties position performs unexpectedly, Link 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 Link Real will offset losses from the drop in Link Real's long position.

The idea behind EPR Properties and Link Real Estate pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.