Correlation Between EastGroup Properties and BTC Digital

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

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

Diversification Opportunities for EastGroup Properties and BTC Digital

-0.13

Correlation Coefficient

EastGroup Properties  BTC Digital

Good diversification

The 3 months correlation between EastGroup and BTC is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding EastGroup Properties and BTC Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTC Digital and EastGroup Properties 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 EastGroup Properties are associated (or correlated) with BTC Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTC Digital has no effect on the direction of EastGroup Properties i.e., EastGroup Properties and BTC Digital go up and down completely randomly.

Pair Corralation between EastGroup Properties and BTC Digital

Considering the 90-day investment horizon EastGroup Properties is expected to generate 0.09 times more return on investment than BTC Digital. However, EastGroup Properties is 10.81 times less risky than BTC Digital. It trades about 0.18 of its potential returns per unit of risk. BTC Digital is currently generating about -0.03 per unit of risk. If you would invest  15,736  in EastGroup Properties on December 19, 2024 and sell it today you would earn a total of  2,226  from holding EastGroup Properties or generate 14.15% return on investment over 90 days.

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

EastGroup Properties  vs.  BTC Digital

EastGroup Properties

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in EastGroup Properties are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating technical and fundamental indicators, EastGroup Properties reported solid returns over the last few months and may actually be approaching a breakup point.

BTC Digital

Risk-Adjusted Performance

Very Weak

Over the last 90 days BTC Digital has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with EastGroup Properties and BTC Digital

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

The idea behind EastGroup Properties and BTC Digital 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.