Correlation Between EastGroup Properties and ALLSTATE

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

By analyzing existing cross correlation between EastGroup Properties and ALLSTATE P 555, you can compare the effects of market volatilities on EastGroup Properties and ALLSTATE 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 ALLSTATE. Check out your portfolio center. Please also check ongoing floating volatility patterns of EastGroup Properties and ALLSTATE.

Diversification Opportunities for EastGroup Properties and ALLSTATE

0.3

Correlation Coefficient

EastGroup Properties  ALLSTATE

Weak diversification

The 3 months correlation between EastGroup and ALLSTATE is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding EastGroup Properties and ALLSTATE P 555 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALLSTATE P 555 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 ALLSTATE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALLSTATE P 555 has no effect on the direction of EastGroup Properties i.e., EastGroup Properties and ALLSTATE go up and down completely randomly.

Pair Corralation between EastGroup Properties and ALLSTATE

Considering the 90-day investment horizon EastGroup Properties is expected to under-perform the ALLSTATE. In addition to that, EastGroup Properties is 1.09 times more volatile than ALLSTATE P 555. It trades about -0.12 of its total potential returns per unit of risk. ALLSTATE P 555 is currently generating about 0.05 per unit of volatility. If you would invest  10,435  in ALLSTATE P 555 on October 9, 2024 and sell it today you would earn a total of  288.00  from holding ALLSTATE P 555 or generate 2.76% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	85.48%
Values	Daily Returns

EastGroup Properties  vs.  ALLSTATE P 555

EastGroup Properties

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EastGroup Properties has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unfluctuating performance, the Stock's technical and fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

ALLSTATE P 555

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ALLSTATE P 555 are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, ALLSTATE is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with EastGroup Properties and ALLSTATE

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

The idea behind EastGroup Properties and ALLSTATE P 555 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.