Correlation Between American Assets and SL Green

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Can any of the company-specific risk be diversified away by investing in both American Assets 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 American Assets and SL Green into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Assets Trust and SL Green Realty, you can compare the effects of market volatilities on American Assets 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 American Assets with a short position of SL Green. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Assets and SL Green.

Diversification Opportunities for American Assets and SL Green

0.81
  Correlation Coefficient

Very poor diversification

The 3 months correlation between American and SL Green is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding American Assets Trust 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 American Assets 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 American Assets Trust 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 American Assets i.e., American Assets and SL Green go up and down completely randomly.

Pair Corralation between American Assets and SL Green

Considering the 90-day investment horizon American Assets Trust is expected to generate 0.65 times more return on investment than SL Green. However, American Assets Trust is 1.54 times less risky than SL Green. It trades about -0.16 of its potential returns per unit of risk. SL Green Realty is currently generating about -0.14 per unit of risk. If you would invest  2,761  in American Assets Trust on July 5, 2022 and sell it today you would lose (189.00)  from holding American Assets Trust or give up 6.85% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

American Assets Trust  vs.  SL Green Realty

 Performance (%) 
       Timeline  
American Assets Trust 
American Performance
0 of 100
Over the last 90 days American Assets 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 basic indicators remain comparatively stable which may send shares a bit higher in November 2022. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

American Price Channel

SL Green Realty 
SL Green Performance
0 of 100
Over the last 90 days SL Green Realty has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's essential indicators remain rather sound which may send shares a bit higher in November 2022. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

SL Green Price Channel

American Assets and SL Green Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with American Assets and SL Green

The main advantage of trading using opposite American Assets and SL Green positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Assets 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.
American Assets vs. WP Carey Co
The idea behind American Assets Trust 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.
SL Green vs. Amazon Inc
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.

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