Correlation Between Regency Centers and Primaris Real

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

By analyzing existing cross correlation between Regency Centers and Primaris Real Estate, you can compare the effects of market volatilities on Regency Centers and Primaris Real 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 Regency Centers with a short position of Primaris Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regency Centers and Primaris Real.

Diversification Opportunities for Regency Centers and Primaris Real

-0.7

Correlation Coefficient

Regency Centers  Primaris Real

Excellent diversification

The 3 months correlation between Regency and Primaris is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Regency Centers and Primaris Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Primaris Real Estate and Regency Centers 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 Regency Centers are associated (or correlated) with Primaris Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Primaris Real Estate has no effect on the direction of Regency Centers i.e., Regency Centers and Primaris Real go up and down completely randomly.

Pair Corralation between Regency Centers and Primaris Real

Considering the 90-day investment horizon Regency Centers is expected to generate 0.84 times more return on investment than Primaris Real. However, Regency Centers is 1.19 times less risky than Primaris Real. It trades about 0.1 of its potential returns per unit of risk. Primaris Real Estate is currently generating about 0.04 per unit of risk. If you would invest  5,880  in Regency Centers on October 2, 2024 and sell it today you would earn a total of  1,465  from holding Regency Centers or generate 24.91% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	99.56%
Values	Daily Returns

Regency Centers  vs.  Primaris Real Estate

Regency Centers

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Regency Centers are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, Regency Centers is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Primaris Real Estate

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Primaris Real Estate has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Regency Centers and Primaris Real

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

The idea behind Regency Centers and Primaris Real Estate 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.