Correlation Between Prologis and W P

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

By analyzing existing cross correlation between Prologis and W P Carey, you can compare the effects of market volatilities on Prologis and W P 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 Prologis with a short position of W P. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prologis and W P.

Diversification Opportunities for Prologis and W P

0.18

Correlation Coefficient

Prologis  W P

Average diversification

The 3 months correlation between Prologis and WPC is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Prologis and W P Carey in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on W P Carey and Prologis 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 Prologis are associated (or correlated) with W P. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of W P Carey has no effect on the direction of Prologis i.e., Prologis and W P go up and down completely randomly.

Pair Corralation between Prologis and W P

Considering the 90-day investment horizon Prologis is expected to under-perform the W P. In addition to that, Prologis is 1.2 times more volatile than W P Carey. It trades about -0.03 of its total potential returns per unit of risk. W P Carey is currently generating about 0.14 per unit of volatility. If you would invest  6,014  in W P Carey on May 12, 2025 and sell it today you would earn a total of  574.00  from holding W P Carey or generate 9.54% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Prologis  vs.  W P Carey

Prologis

Risk-Adjusted Performance

Weakest

Over the last 90 days Prologis has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound essential indicators, Prologis is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

W P Carey

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in W P Carey are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, W P may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Prologis and W P

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

The idea behind Prologis and W P Carey 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.