Correlation Between Western Asset and EastGroup Properties
Can any of the company-specific risk be diversified away by investing in both Western Asset and EastGroup Properties 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 Western Asset and EastGroup Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Asset Investment and EastGroup Properties, you can compare the effects of market volatilities on Western Asset and EastGroup Properties 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 Western Asset with a short position of EastGroup Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and EastGroup Properties.
Diversification Opportunities for Western Asset and EastGroup Properties
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Western and EastGroup is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Investment and EastGroup Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EastGroup Properties and Western Asset 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 Western Asset Investment are associated (or correlated) with EastGroup Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EastGroup Properties has no effect on the direction of Western Asset i.e., Western Asset and EastGroup Properties go up and down completely randomly.
Pair Corralation between Western Asset and EastGroup Properties
Considering the 90-day investment horizon Western Asset Investment is expected to generate 0.31 times more return on investment than EastGroup Properties. However, Western Asset Investment is 3.25 times less risky than EastGroup Properties. It trades about 0.13 of its potential returns per unit of risk. EastGroup Properties is currently generating about 0.0 per unit of risk. If you would invest 1,612 in Western Asset Investment on May 7, 2025 and sell it today you would earn a total of 48.00 from holding Western Asset Investment or generate 2.98% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Western Asset Investment vs. EastGroup Properties
Performance |
Timeline |
Western Asset Investment |
EastGroup Properties |
Western Asset and EastGroup Properties Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Western Asset and EastGroup Properties
The main advantage of trading using opposite Western Asset and EastGroup Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset position performs unexpectedly, EastGroup Properties 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 EastGroup Properties will offset losses from the drop in EastGroup Properties' long position.Western Asset vs. NXG NextGen Infrastructure | Western Asset vs. GAMCO Natural Resources | Western Asset vs. MFS Investment Grade | Western Asset vs. Eaton Vance Senior |
EastGroup Properties vs. Rexford Industrial Realty | EastGroup Properties vs. Terreno Realty | EastGroup Properties vs. First Industrial Realty | EastGroup Properties vs. Americold Realty Trust |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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