Real Estate Correlations

PRAEX Fund

USD 29.95 0.00 0.00%

The current 90-days correlation between Real Estate Securities and Realty Income is -0.1 (i.e., Good diversification). The correlation of Real Estate is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak. If the correlation is 0, the equities are not correlated; they are entirely random.

Real Estate Correlation With Market

Significant diversification

The correlation between Real Estate Securities and DJI is 0.04 (i.e., Significant diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Real Estate Securities and DJI in the same portfolio, assuming nothing else is changed.

Check out Your Equity Center to better understand how to build diversified portfolios. Also, note that the market value of any mutual fund could be closely tied with the direction of predictive economic indicators such as signals in income.

Moving against Real Mutual Fund

0.69	DOUG	Douglas Elliman	Pair Corr
0.61	DX	Dynex Capital	Pair Corr
0.5	HR	Healthcare Realty Trust	Pair Corr
0.47	MITT-PC	AG Mortgage Investment	Pair Corr
0.44	OZ	Belpointe PREP LLC	Pair Corr
0.4	PK	Park Hotels Resorts	Pair Corr
0.37	KW	Kennedy Wilson Holdings	Pair Corr
0.37	UE	Urban Edge Properties	Pair Corr
0.61	AHR	American Healthcare REIT,	Pair Corr
0.58	EQIX	Equinix	Pair Corr
0.55	AAT	American Assets Trust	Pair Corr
0.49	AHT	Ashford Hospitality Trust	Pair Corr
0.44	ACR	Acres Commercial Realty	Pair Corr
0.42	FBRT	Franklin BSP Realty	Pair Corr
0.41	WELL	Welltower	Pair Corr
0.37	AKR	Acadia Realty Trust	Pair Corr
0.35	ADC	Agree Realty	Pair Corr

Related Correlations Analysis

	O	DX	FR	HR	KW	OZ	PK	PW	RC	UE
O		-0.5	0.84	-0.02	-0.31	-0.66	-0.66	-0.33	0.1	-0.75	O
DX	-0.5		-0.25	0.54	0.54	0.74	0.63	0.23	0.35	0.44	DX
FR	0.84	-0.25		0.13	-0.14	-0.41	-0.43	-0.46	0.45	-0.69	FR
HR	-0.02	0.54	0.13		0.51	0.37	0.33	0.17	0.46	0.09	HR
KW	-0.31	0.54	-0.14	0.51		0.28	0.39	0.26	0.01	0.55	KW
OZ	-0.66	0.74	-0.41	0.37	0.28		0.78	0.3	0.48	0.29	OZ
PK	-0.66	0.63	-0.43	0.33	0.39	0.78		0.42	0.4	0.41	PK
PW	-0.33	0.23	-0.46	0.17	0.26	0.3	0.42		-0.14	0.19	PW
RC	0.1	0.35	0.45	0.46	0.01	0.48	0.4	-0.14		-0.36	RC
UE	-0.75	0.44	-0.69	0.09	0.55	0.29	0.41	0.19	-0.36		UE
	O	DX	FR	HR	KW	OZ	PK	PW	RC	UE

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Correlation Matchups

Over a given time period, the two securities move together when the Correlation Coefficient is positive. Conversely, the two assets move in opposite directions when the Correlation Coefficient is negative. Determining your positions' relationship to each other is valuable for analyzing and projecting your portfolio's future expected return and risk.

High positive correlations

FR	+ 0.84	O
PK	+ 0.78	OZ
OZ	+ 0.74	DX
PK	+ 0.63	DX
UE	+ 0.55	KW
HR	+ 0.54	DX

High negative correlations

UE	- 0.75	O
UE	- 0.69	FR
PK	- 0.66	O
OZ	- 0.66	O
DX	- 0.5	O
PW	- 0.46	FR

Risk-Adjusted Indicators

There is a big difference between Real Mutual Fund performing well and Real Estate Mutual Fund doing well as a business compared to the competition. There are so many exceptions to the norm that investors cannot definitively determine what's good or bad unless they analyze Real Estate's multiple risk-adjusted performance indicators across the competitive landscape. These indicators are quantitative in nature and help investors forecast volatility and risk-adjusted expected returns across various positions.

	Mean Deviation	Jensen Alpha	Sortino Ratio	Treynor Ratio	Semi Deviation	Expected Shortfall	Potential Upside	Value @Risk	Maximum Drawdown
O	0.80	(0.19)	0.00	1.51	0.00	0.00	1.37	(1.84)	5.17
DX	0.72	(0.02)	(0.05)	0.02	1.03	(0.68)	1.10	(1.47)	3.85
FR	0.85	(0.15)	0.00	(0.31)	0.00	0.00	1.49	(1.72)	3.74
HR	1.22	(0.10)	0.00	(0.50)	0.00	0.00	2.01	(2.61)	8.22
KW	1.38	(0.13)	0.00	(0.04)	0.00	0.00	2.49	(2.95)	9.72
OZ	1.23	0.25	0.11	(1.57)	1.41	(1.51)	2.91	(2.09)	9.31
PK	1.27	0.15	0.08	0.49	1.24	(1.44)	2.99	(2.22)	10.98
PW	8.26	1.08	0.11	(0.87)	7.92	(11.11)	15.00	(13.84)	119.44
RC	1.32	0.02	(0.02)	(0.71)	1.86	(1.35)	2.95	(3.17)	8.92
UE	0.82	0.04	0.00	0.15	0.97	(0.85)	1.73	(1.60)	4.42

Real Estate Related Equities

One of the popular trading techniques among algorithmic traders is to use market-neutral strategies where every trade hedges away some risk. Because there are two separate transactions required, even if one position performs unexpectedly, the other equity can make up some of the losses. Below are some of the equities that can be combined with Real Estate mutual fund to make a market-neutral strategy. Peer analysis of Real Estate could also be used in its relative valuation, which is a method of valuing Real Estate by comparing valuation metrics with similar companies.

Realty Income Dynex Capital First Industrial Realty Healthcare Realty Trust Kennedy Wilson Holdings Belpointe PREP LLC Park Hotels Resorts Power REIT Ready Capital Corp Urban Edge Properties American Airlines Group Alcoa Corp Apple Inc Best Buy Co Citigroup

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