Correlation Between Urban Edge and Brandywine Realty

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

By analyzing existing cross correlation between Urban Edge Properties and Brandywine Realty Trust, you can compare the effects of market volatilities on Urban Edge and Brandywine Realty 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 Urban Edge with a short position of Brandywine Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Urban Edge and Brandywine Realty.

Diversification Opportunities for Urban Edge and Brandywine Realty

0.18

Correlation Coefficient

Urban Edge  Brandywine Realty

Average diversification

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

Pair Corralation between Urban Edge and Brandywine Realty

Allowing for the 90-day total investment horizon Urban Edge Properties is expected to generate 0.84 times more return on investment than Brandywine Realty. However, Urban Edge Properties is 1.18 times less risky than Brandywine Realty. It trades about 0.08 of its potential returns per unit of risk. Brandywine Realty Trust is currently generating about -0.03 per unit of risk. If you would invest  1,823  in Urban Edge Properties on May 7, 2025 and sell it today you would earn a total of  121.00  from holding Urban Edge Properties or generate 6.64% return on investment over 90 days.

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

Urban Edge Properties  vs.  Brandywine Realty Trust

Urban Edge Properties

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Urban Edge Properties are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak technical and fundamental indicators, Urban Edge may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Brandywine Realty Trust

Risk-Adjusted Performance

Weakest

Over the last 90 days Brandywine Realty Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental indicators, Brandywine Realty is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Urban Edge and Brandywine Realty

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

The idea behind Urban Edge Properties and Brandywine Realty Trust 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.

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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.