Correlation Between 25278XAV1 and SL Green

Can any of the company-specific risk be diversified away by investing in both 25278XAV1 and SL Green 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 25278XAV1 and SL Green into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FANG 625 15 MAR 33 and SL Green Realty, you can compare the effects of market volatilities on 25278XAV1 and SL Green 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 25278XAV1 with a short position of SL Green. Check out your portfolio center. Please also check ongoing floating volatility patterns of 25278XAV1 and SL Green.

Diversification Opportunities for 25278XAV1 and SL Green

-0.09

Correlation Coefficient

25278XAV1  SL Green

Good diversification

The 3 months correlation between 25278XAV1 and SLG is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding FANG 625 15 MAR 33 and SL Green Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SL Green Realty and 25278XAV1 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 FANG 625 15 MAR 33 are associated (or correlated) with SL Green. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SL Green Realty has no effect on the direction of 25278XAV1 i.e., 25278XAV1 and SL Green go up and down completely randomly.

Pair Corralation between 25278XAV1 and SL Green

Assuming the 90 days trading horizon FANG 625 15 MAR 33 is expected to generate 0.18 times more return on investment than SL Green. However, FANG 625 15 MAR 33 is 5.55 times less risky than SL Green. It trades about 0.08 of its potential returns per unit of risk. SL Green Realty is currently generating about -0.11 per unit of risk. If you would invest  10,401  in FANG 625 15 MAR 33 on December 22, 2024 and sell it today you would earn a total of  183.00  from holding FANG 625 15 MAR 33 or generate 1.76% return on investment over 90 days.

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

FANG 625 15 MAR 33  vs.  SL Green Realty

FANG 625 15

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in FANG 625 15 MAR 33 are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, 25278XAV1 is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

SL Green Realty

Risk-Adjusted Performance

Very Weak

Over the last 90 days SL Green Realty 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 essential indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with 25278XAV1 and SL Green

The main advantage of trading using opposite 25278XAV1 and SL Green positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 25278XAV1 position performs unexpectedly, SL Green 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 SL Green will offset losses from the drop in SL Green's long position.

The idea behind FANG 625 15 MAR 33 and SL Green Realty 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.