Correlation Between Primaris Retail and Dream Industrial

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

By analyzing existing cross correlation between Primaris Retail RE and Dream Industrial Real, you can compare the effects of market volatilities on Primaris Retail and Dream Industrial 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 Primaris Retail with a short position of Dream Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Primaris Retail and Dream Industrial.

Diversification Opportunities for Primaris Retail and Dream Industrial

0.75

Correlation Coefficient

Primaris Retail  Dream Industrial

Poor diversification

The 3 months correlation between Primaris and Dream is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Primaris Retail RE and Dream Industrial Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dream Industrial Real and Primaris Retail 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 Primaris Retail RE are associated (or correlated) with Dream Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dream Industrial Real has no effect on the direction of Primaris Retail i.e., Primaris Retail and Dream Industrial go up and down completely randomly.

Pair Corralation between Primaris Retail and Dream Industrial

Assuming the 90 days trading horizon Primaris Retail is expected to generate 2.05 times less return on investment than Dream Industrial. But when comparing it to its historical volatility, Primaris Retail RE is 1.28 times less risky than Dream Industrial. It trades about 0.12 of its potential returns per unit of risk. Dream Industrial Real is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  1,034  in Dream Industrial Real on April 17, 2025 and sell it today you would earn a total of  154.00  from holding Dream Industrial Real or generate 14.89% return on investment over 90 days.

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

Primaris Retail RE  vs.  Dream Industrial Real

Primaris Retail RE

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Primaris Retail RE are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Primaris Retail may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Dream Industrial Real

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Dream Industrial Real are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Dream Industrial sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Primaris Retail and Dream Industrial

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

The idea behind Primaris Retail RE and Dream Industrial Real 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.