Correlation Between Tanger Factory and Site Centers

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

By analyzing existing cross correlation between Tanger Factory Outlet and Site Centers Corp, you can compare the effects of market volatilities on Tanger Factory and Site Centers 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 Tanger Factory with a short position of Site Centers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tanger Factory and Site Centers.

Diversification Opportunities for Tanger Factory and Site Centers

0.45

Correlation Coefficient

Tanger Factory  Site Centers

Very weak diversification

The 3 months correlation between Tanger and Site is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Tanger Factory Outlet and Site Centers Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Site Centers Corp and Tanger Factory 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 Tanger Factory Outlet are associated (or correlated) with Site Centers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Site Centers Corp has no effect on the direction of Tanger Factory i.e., Tanger Factory and Site Centers go up and down completely randomly.

Pair Corralation between Tanger Factory and Site Centers

Considering the 90-day investment horizon Tanger Factory Outlet is expected to generate 0.96 times more return on investment than Site Centers. However, Tanger Factory Outlet is 1.04 times less risky than Site Centers. It trades about 0.21 of its potential returns per unit of risk. Site Centers Corp is currently generating about -0.25 per unit of risk. If you would invest  3,290  in Tanger Factory Outlet on November 29, 2024 and sell it today you would earn a total of  222.00  from holding Tanger Factory Outlet or generate 6.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Tanger Factory Outlet  vs.  Site Centers Corp

Tanger Factory Outlet

Risk-Adjusted Performance

Very Weak

Over the last 90 days Tanger Factory Outlet has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward-looking signals, Tanger Factory is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Site Centers Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Site Centers Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Etf's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the fund shareholders.

Pair Trading with Tanger Factory and Site Centers

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

The idea behind Tanger Factory Outlet and Site Centers Corp 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.

Check out your portfolio center.

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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.