Correlation Between Slate Grocery and Firm Capital

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

By analyzing existing cross correlation between Slate Grocery REIT and Firm Capital Property, you can compare the effects of market volatilities on Slate Grocery and Firm 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 Slate Grocery with a short position of Firm Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Slate Grocery and Firm Capital.

Diversification Opportunities for Slate Grocery and Firm Capital

0.44

Correlation Coefficient

Slate Grocery  Firm Capital

Very weak diversification

The 3 months correlation between Slate and Firm is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Slate Grocery REIT and Firm Capital Property in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Firm Capital Property and Slate Grocery 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 Slate Grocery REIT are associated (or correlated) with Firm Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Firm Capital Property has no effect on the direction of Slate Grocery i.e., Slate Grocery and Firm Capital go up and down completely randomly.

Pair Corralation between Slate Grocery and Firm Capital

Assuming the 90 days trading horizon Slate Grocery REIT is expected to generate 0.86 times more return on investment than Firm Capital. However, Slate Grocery REIT is 1.16 times less risky than Firm Capital. It trades about 0.13 of its potential returns per unit of risk. Firm Capital Property is currently generating about 0.06 per unit of risk. If you would invest  1,348  in Slate Grocery REIT on April 20, 2025 and sell it today you would earn a total of  98.00  from holding Slate Grocery REIT or generate 7.27% return on investment over 90 days.

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

Slate Grocery REIT  vs.  Firm Capital Property

Slate Grocery REIT

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Slate Grocery REIT are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Slate Grocery may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Firm Capital Property

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Firm Capital Property are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental indicators, Firm Capital is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Slate Grocery and Firm Capital

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

The idea behind Slate Grocery REIT and Firm Capital Property 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.