Correlation Between Truist Financial and STAG Industrial,

Can any of the company-specific risk be diversified away by investing in both Truist Financial and STAG Industrial, 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 Truist Financial and STAG Industrial, into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Truist Financial and STAG Industrial,

0.29

Correlation Coefficient

Truist Financial  STAG Industrial,

Modest diversification

The 3 months correlation between Truist and STAG is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Truist Financial and STAG Industrial, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STAG Industrial, and Truist Financial 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 Truist Financial are associated (or correlated) with STAG Industrial,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STAG Industrial, has no effect on the direction of Truist Financial i.e., Truist Financial and STAG Industrial, go up and down completely randomly.

Pair Corralation between Truist Financial and STAG Industrial,

Assuming the 90 days trading horizon Truist Financial is expected to under-perform the STAG Industrial,. In addition to that, Truist Financial is 1.09 times more volatile than STAG Industrial,. It trades about -0.08 of its total potential returns per unit of risk. STAG Industrial, is currently generating about -0.06 per unit of volatility. If you would invest  4,239  in STAG Industrial, on December 24, 2024 and sell it today you would lose (312.00) from holding STAG Industrial, or give up 7.36% of portfolio value over 90 days.

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

Truist Financial  vs.  STAG Industrial,

Truist Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Truist Financial has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental drivers remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

STAG Industrial,

Risk-Adjusted Performance

Very Weak

Over the last 90 days STAG Industrial, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Truist Financial and STAG Industrial,

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

The idea behind Truist Financial and STAG Industrial, 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.