Correlation Between Corenergy Infras and EPR Properties

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

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

Diversification Opportunities for Corenergy Infras and EPR Properties

-0.4

Correlation Coefficient

Corenergy Infras  EPR Properties

Very good diversification

The 3 months correlation between Corenergy and EPR is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Corenergy Infras and EPR Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EPR Properties and Corenergy Infras 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 Corenergy Infras are associated (or correlated) with EPR Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EPR Properties has no effect on the direction of Corenergy Infras i.e., Corenergy Infras and EPR Properties go up and down completely randomly.

Pair Corralation between Corenergy Infras and EPR Properties

If you would invest  2,229  in EPR Properties on September 3, 2024 and sell it today you would lose (4.00) from holding EPR Properties or give up 0.18% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	1.56%
Values	Daily Returns

Corenergy Infras  vs.  EPR Properties

Corenergy Infras

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Corenergy Infras has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Corenergy Infras is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

EPR Properties

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EPR Properties has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, EPR Properties is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Corenergy Infras and EPR Properties

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

The idea behind Corenergy Infras and EPR Properties 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..