Correlation Between VICI Properties and Sterling Capital

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

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

Diversification Opportunities for VICI Properties and Sterling Capital

0.74

Correlation Coefficient

VICI Properties  Sterling Capital

Poor diversification

The 3 months correlation between VICI and Sterling is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding VICI Properties and Sterling Capital Stratton in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Capital Stratton and VICI Properties 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 VICI Properties are associated (or correlated) with Sterling Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sterling Capital Stratton has no effect on the direction of VICI Properties i.e., VICI Properties and Sterling Capital go up and down completely randomly.

Pair Corralation between VICI Properties and Sterling Capital

Given the investment horizon of 90 days VICI Properties is expected to generate 0.96 times more return on investment than Sterling Capital. However, VICI Properties is 1.05 times less risky than Sterling Capital. It trades about -0.11 of its potential returns per unit of risk. Sterling Capital Stratton is currently generating about -0.12 per unit of risk. If you would invest  3,197  in VICI Properties on October 7, 2024 and sell it today you would lose (251.00) from holding VICI Properties or give up 7.85% of portfolio value over 90 days.

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

VICI Properties  vs.  Sterling Capital Stratton

VICI Properties

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VICI Properties has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Sterling Capital Stratton

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sterling Capital Stratton has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with VICI Properties and Sterling Capital

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

The idea behind VICI Properties and Sterling Capital Stratton 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.