Correlation Between Presidio Property and Modiv

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

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

Diversification Opportunities for Presidio Property and Modiv

0.53

Correlation Coefficient

Presidio Property  Modiv

Very weak diversification

The 3 months correlation between Presidio and Modiv is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Presidio Property Trust and Modiv Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Modiv Inc and Presidio Property 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 Presidio Property Trust are associated (or correlated) with Modiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Modiv Inc has no effect on the direction of Presidio Property i.e., Presidio Property and Modiv go up and down completely randomly.

Pair Corralation between Presidio Property and Modiv

Given the investment horizon of 90 days Presidio Property Trust is expected to under-perform the Modiv. In addition to that, Presidio Property is 6.49 times more volatile than Modiv Inc. It trades about -0.09 of its total potential returns per unit of risk. Modiv Inc is currently generating about -0.04 per unit of volatility. If you would invest  2,446  in Modiv Inc on December 21, 2024 and sell it today you would lose (44.00) from holding Modiv Inc or give up 1.8% of portfolio value over 90 days.

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

Presidio Property Trust  vs.  Modiv Inc

Presidio Property Trust

Risk-Adjusted Performance

Very Weak

Over the last 90 days Presidio Property Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Modiv Inc

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Presidio Property and Modiv

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

The idea behind Presidio Property Trust and Modiv Inc 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.