Correlation Between Federal Realty and Urstadt Biddle

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

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

Diversification Opportunities for Federal Realty and Urstadt Biddle

-0.06

Correlation Coefficient

Federal Realty  Urstadt Biddle

Good diversification

The 3 months correlation between Federal and Urstadt is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Federal Realty Investment and Urstadt Biddle Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Urstadt Biddle Properties and Federal 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 Federal Realty Investment are associated (or correlated) with Urstadt Biddle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Urstadt Biddle Properties has no effect on the direction of Federal Realty i.e., Federal Realty and Urstadt Biddle go up and down completely randomly.

Pair Corralation between Federal Realty and Urstadt Biddle

If you would invest  11,353  in Federal Realty Investment on August 31, 2024 and sell it today you would earn a total of  312.00  from holding Federal Realty Investment or generate 2.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Federal Realty Investment  vs.  Urstadt Biddle Properties

Federal Realty Investment

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Federal Realty Investment are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Federal Realty is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Urstadt Biddle Properties

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Urstadt Biddle Properties has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, Urstadt Biddle is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Federal Realty and Urstadt Biddle

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

The idea behind Federal Realty Investment and Urstadt Biddle Properties 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..