Correlation Between Acadia Realty and Saul Centers
Can any of the company-specific risk be diversified away by investing in both Acadia Realty and Saul Centers 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 Acadia Realty and Saul Centers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acadia Realty Trust and Saul Centers, you can compare the effects of market volatilities on Acadia Realty and Saul Centers 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 Acadia Realty with a short position of Saul Centers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acadia Realty and Saul Centers.
Diversification Opportunities for Acadia Realty and Saul Centers
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Acadia and Saul is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Acadia Realty Trust and Saul Centers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saul Centers and Acadia 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 Acadia Realty Trust are associated (or correlated) with Saul Centers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saul Centers has no effect on the direction of Acadia Realty i.e., Acadia Realty and Saul Centers go up and down completely randomly.
Pair Corralation between Acadia Realty and Saul Centers
Considering the 90-day investment horizon Acadia Realty Trust is expected to generate 2.47 times more return on investment than Saul Centers. However, Acadia Realty is 2.47 times more volatile than Saul Centers. It trades about -0.02 of its potential returns per unit of risk. Saul Centers is currently generating about -0.17 per unit of risk. If you would invest 2,342 in Acadia Realty Trust on November 5, 2024 and sell it today you would lose (23.00) from holding Acadia Realty Trust or give up 0.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acadia Realty Trust vs. Saul Centers
Performance |
| Timeline |
| Acadia Realty Trust |
| Saul Centers |
Acadia Realty and Saul Centers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acadia Realty and Saul Centers
The main advantage of trading using opposite Acadia Realty and Saul Centers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acadia Realty position performs unexpectedly, Saul Centers 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 Saul Centers will offset losses from the drop in Saul Centers' long position.| Acadia Realty vs. Rithm Property Trust | Acadia Realty vs. Urban Edge Properties | Acadia Realty vs. Kite Realty Group | Acadia Realty vs. Site Centers Corp |
| Saul Centers vs. Saul Centers | Saul Centers vs. Saul Centers | Saul Centers vs. Regency Centers | Saul Centers vs. Urban Edge Properties |
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.
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