Correlation Between Plaza Retail and Altair Resources

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

By analyzing existing cross correlation between Plaza Retail REIT and Altair Resources, you can compare the effects of market volatilities on Plaza Retail and Altair Resources 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 Plaza Retail with a short position of Altair Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Plaza Retail and Altair Resources.

Diversification Opportunities for Plaza Retail and Altair Resources

0.0

Correlation Coefficient

Plaza Retail  Altair Resources

Pay attention - limited upside

The 3 months correlation between Plaza and Altair is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Plaza Retail REIT and Altair Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altair Resources and Plaza Retail 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 Plaza Retail REIT are associated (or correlated) with Altair Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altair Resources has no effect on the direction of Plaza Retail i.e., Plaza Retail and Altair Resources go up and down completely randomly.

Pair Corralation between Plaza Retail and Altair Resources

If you would invest  348.00  in Plaza Retail REIT on December 25, 2024 and sell it today you would earn a total of  32.00  from holding Plaza Retail REIT or generate 9.2% return on investment over 90 days.

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

Plaza Retail REIT  vs.  Altair Resources

Plaza Retail REIT

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Plaza Retail REIT are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Plaza Retail may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Altair Resources

Risk-Adjusted Performance

Very Weak

Over the last 90 days Altair Resources has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Altair Resources is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Plaza Retail and Altair Resources

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

The idea behind Plaza Retail REIT and Altair Resources 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.