Correlation Between Site Centers and VanEck Mortgage

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

By analyzing existing cross correlation between Site Centers Corp and VanEck Mortgage REIT, you can compare the effects of market volatilities on Site Centers and VanEck Mortgage 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 Site Centers with a short position of VanEck Mortgage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Site Centers and VanEck Mortgage.

Diversification Opportunities for Site Centers and VanEck Mortgage

-0.62

Correlation Coefficient

Site Centers  VanEck Mortgage

Excellent diversification

The 3 months correlation between Site and VanEck is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Site Centers Corp and VanEck Mortgage REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Mortgage REIT and Site Centers 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 Site Centers Corp are associated (or correlated) with VanEck Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Mortgage REIT has no effect on the direction of Site Centers i.e., Site Centers and VanEck Mortgage go up and down completely randomly.

Pair Corralation between Site Centers and VanEck Mortgage

Given the investment horizon of 90 days Site Centers Corp is expected to generate 6.02 times more return on investment than VanEck Mortgage. However, Site Centers is 6.02 times more volatile than VanEck Mortgage REIT. It trades about 0.1 of its potential returns per unit of risk. VanEck Mortgage REIT is currently generating about -0.14 per unit of risk. If you would invest  1,149  in Site Centers Corp on September 20, 2024 and sell it today you would earn a total of  378.00  from holding Site Centers Corp or generate 32.9% return on investment over 90 days.

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

Site Centers Corp  vs.  VanEck Mortgage REIT

Site Centers Corp

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Site Centers Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Site Centers exhibited solid returns over the last few months and may actually be approaching a breakup point.

VanEck Mortgage REIT

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VanEck Mortgage REIT has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Etf's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the exchange-traded fund private investors.

Pair Trading with Site Centers and VanEck Mortgage

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

The idea behind Site Centers Corp and VanEck Mortgage REIT 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.