Correlation Between STAG Industrial, and FIEI3F

Can any of the company-specific risk be diversified away by investing in both STAG Industrial, and FIEI3F 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 STAG Industrial, and FIEI3F into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between STAG Industrial, and FIEI3F, you can compare the effects of market volatilities on STAG Industrial, and FIEI3F 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 STAG Industrial, with a short position of FIEI3F. Check out your portfolio center. Please also check ongoing floating volatility patterns of STAG Industrial, and FIEI3F.

Diversification Opportunities for STAG Industrial, and FIEI3F

0.01

Correlation Coefficient

STAG Industrial,  FIEI3F

Significant diversification

The 3 months correlation between STAG and FIEI3F is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding STAG Industrial, and FIEI3F in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIEI3F and STAG Industrial, 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 STAG Industrial, are associated (or correlated) with FIEI3F. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIEI3F has no effect on the direction of STAG Industrial, i.e., STAG Industrial, and FIEI3F go up and down completely randomly.

Pair Corralation between STAG Industrial, and FIEI3F

Assuming the 90 days trading horizon STAG Industrial, is expected to generate 0.46 times more return on investment than FIEI3F. However, STAG Industrial, is 2.17 times less risky than FIEI3F. It trades about -0.28 of its potential returns per unit of risk. FIEI3F is currently generating about -0.31 per unit of risk. If you would invest  4,402  in STAG Industrial, on October 11, 2024 and sell it today you would lose (466.00) from holding STAG Industrial, or give up 10.59% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	44.44%
Values	Daily Returns

STAG Industrial,  vs.  FIEI3F

STAG Industrial,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days STAG Industrial, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, STAG Industrial, is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

FIEI3F

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days FIEI3F has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with STAG Industrial, and FIEI3F

The main advantage of trading using opposite STAG Industrial, and FIEI3F positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STAG Industrial, position performs unexpectedly, FIEI3F 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 FIEI3F will offset losses from the drop in FIEI3F's long position.

The idea behind STAG Industrial, and FIEI3F 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..