Correlation Between Getty Realty and Under Armour

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

By analyzing existing cross correlation between Getty Realty and Under Armour C, you can compare the effects of market volatilities on Getty Realty and Under Armour 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 Getty Realty with a short position of Under Armour. Check out your portfolio center. Please also check ongoing floating volatility patterns of Getty Realty and Under Armour.

Diversification Opportunities for Getty Realty and Under Armour

0.45

Correlation Coefficient

Getty Realty  Under Armour

Very weak diversification

The 3 months correlation between Getty and Under is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Getty Realty and Under Armour C in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Under Armour C and Getty Realty 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 Getty Realty are associated (or correlated) with Under Armour. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Under Armour C has no effect on the direction of Getty Realty i.e., Getty Realty and Under Armour go up and down completely randomly.

Pair Corralation between Getty Realty and Under Armour

Considering the 90-day investment horizon Getty Realty is expected to generate 18.5 times less return on investment than Under Armour. But when comparing it to its historical volatility, Getty Realty is 4.32 times less risky than Under Armour. It trades about 0.02 of its potential returns per unit of risk. Under Armour C is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  724.00  in Under Armour C on September 13, 2024 and sell it today you would earn a total of  174.00  from holding Under Armour C or generate 24.03% return on investment over 90 days.

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

Getty Realty  vs.  Under Armour C

Getty Realty

Risk-Adjusted Performance

1 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Getty Realty are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Getty Realty is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Under Armour C

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Under Armour C are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat inconsistent basic indicators, Under Armour sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Getty Realty and Under Armour

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

The idea behind Getty Realty and Under Armour C 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.