Correlation Between Arbor Realty and Brookfield DTLA
Can any of the company-specific risk be diversified away by investing in both Arbor Realty and Brookfield DTLA 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 Arbor Realty and Brookfield DTLA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arbor Realty Trust and Brookfield DTLA, you can compare the effects of market volatilities on Arbor Realty and Brookfield DTLA 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 Arbor Realty with a short position of Brookfield DTLA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arbor Realty and Brookfield DTLA.
Diversification Opportunities for Arbor Realty and Brookfield DTLA
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Arbor and Brookfield is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Arbor Realty Trust and Brookfield DTLA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brookfield DTLA and Arbor Realty 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 Arbor Realty Trust are associated (or correlated) with Brookfield DTLA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brookfield DTLA has no effect on the direction of Arbor Realty i.e., Arbor Realty and Brookfield DTLA go up and down completely randomly.
Pair Corralation between Arbor Realty and Brookfield DTLA
If you would invest 1,909 in Arbor Realty Trust on August 24, 2024 and sell it today you would earn a total of 152.00 from holding Arbor Realty Trust or generate 7.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.8% |
| Values | Daily Returns |
Arbor Realty Trust vs. Brookfield DTLA
Performance |
| Timeline |
| Arbor Realty Trust |
| Brookfield DTLA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Arbor Realty and Brookfield DTLA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arbor Realty and Brookfield DTLA
The main advantage of trading using opposite Arbor Realty and Brookfield DTLA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arbor Realty position performs unexpectedly, Brookfield DTLA 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 Brookfield DTLA will offset losses from the drop in Brookfield DTLA's long position.| Arbor Realty vs. Cherry Hill Mortgage | Arbor Realty vs. Chimera Investment | Arbor Realty vs. PennyMac Mortgage Investment | Arbor Realty vs. Lument Finance Trust |
| Brookfield DTLA vs. Zane Interactive Publishing | Brookfield DTLA vs. Iridium Communications | Brookfield DTLA vs. Freedom Internet Group | Brookfield DTLA vs. Universal Technical Institute |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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