Correlation Between Acadia Realty and Centerspace
Can any of the company-specific risk be diversified away by investing in both Acadia Realty and Centerspace 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 Centerspace 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 Centerspace, you can compare the effects of market volatilities on Acadia Realty and Centerspace 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 Centerspace. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acadia Realty and Centerspace.
Diversification Opportunities for Acadia Realty and Centerspace
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Acadia and Centerspace is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Acadia Realty Trust and Centerspace in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Centerspace 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 Centerspace. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Centerspace has no effect on the direction of Acadia Realty i.e., Acadia Realty and Centerspace go up and down completely randomly.
Pair Corralation between Acadia Realty and Centerspace
Considering the 90-day investment horizon Acadia Realty Trust is expected to generate 1.0 times more return on investment than Centerspace. However, Acadia Realty is 1.0 times more volatile than Centerspace. It trades about 0.08 of its potential returns per unit of risk. Centerspace is currently generating about 0.04 per unit of risk. If you would invest 1,351 in Acadia Realty Trust on August 25, 2024 and sell it today you would earn a total of 1,171 from holding Acadia Realty Trust or generate 86.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acadia Realty Trust vs. Centerspace
Performance |
| Timeline |
| Acadia Realty Trust |
| Centerspace |
Acadia Realty and Centerspace Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acadia Realty and Centerspace
The main advantage of trading using opposite Acadia Realty and Centerspace positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acadia Realty position performs unexpectedly, Centerspace 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 Centerspace will offset losses from the drop in Centerspace's long position.| Acadia Realty vs. Urban Edge Properties | Acadia Realty vs. Site Centers Corp | Acadia Realty vs. Kite Realty Group | Acadia Realty vs. Inventrust Properties Corp |
| Centerspace vs. Essex Property Trust | Centerspace vs. Mid America Apartment Communities | Centerspace vs. Camden Property Trust | Centerspace vs. UDR Inc |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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