Correlation Between SL Green and Service Properties
Can any of the company-specific risk be diversified away by investing in both SL Green and Service Properties 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 SL Green and Service Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SL Green Realty and Service Properties Trust, you can compare the effects of market volatilities on SL Green and Service Properties 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 SL Green with a short position of Service Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of SL Green and Service Properties.
Diversification Opportunities for SL Green and Service Properties
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SLG and Service is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding SL Green Realty and Service Properties Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Service Properties Trust and SL Green 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 SL Green Realty are associated (or correlated) with Service Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Service Properties Trust has no effect on the direction of SL Green i.e., SL Green and Service Properties go up and down completely randomly.
Pair Corralation between SL Green and Service Properties
Considering the 90-day investment horizon SL Green Realty is expected to generate 0.68 times more return on investment than Service Properties. However, SL Green Realty is 1.47 times less risky than Service Properties. It trades about -0.07 of its potential returns per unit of risk. Service Properties Trust is currently generating about -0.09 per unit of risk. If you would invest 5,772 in SL Green Realty on July 28, 2025 and sell it today you would lose (586.00) from holding SL Green Realty or give up 10.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SL Green Realty vs. Service Properties Trust
Performance |
| Timeline |
| SL Green Realty |
| Service Properties Trust |
SL Green and Service Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SL Green and Service Properties
The main advantage of trading using opposite SL Green and Service Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SL Green position performs unexpectedly, Service Properties 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 Service Properties will offset losses from the drop in Service Properties' long position.| SL Green vs. Boston Properties | SL Green vs. Douglas Emmett | SL Green vs. Kilroy Realty Corp | SL Green vs. Alexandria Real Estate |
| Service Properties vs. Industrial Logistics Properties | Service Properties vs. Peakstone Realty Trust | Service Properties vs. Net Lease Office | Service Properties vs. Community Healthcare Trust |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
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