Correlation Between AMREP and American Realty
Can any of the company-specific risk be diversified away by investing in both AMREP and American Realty 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 AMREP and American Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMREP and American Realty Investors, you can compare the effects of market volatilities on AMREP and American Realty 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 AMREP with a short position of American Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMREP and American Realty.
Diversification Opportunities for AMREP and American Realty
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AMREP and American is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding AMREP and American Realty Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Realty Investors and AMREP 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 AMREP are associated (or correlated) with American Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Realty Investors has no effect on the direction of AMREP i.e., AMREP and American Realty go up and down completely randomly.
Pair Corralation between AMREP and American Realty
Considering the 90-day investment horizon AMREP is expected to generate 1.44 times more return on investment than American Realty. However, AMREP is 1.44 times more volatile than American Realty Investors. It trades about 0.28 of its potential returns per unit of risk. American Realty Investors is currently generating about 0.01 per unit of risk. If you would invest 2,824 in AMREP on August 24, 2024 and sell it today you would earn a total of 862.00 from holding AMREP or generate 30.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMREP vs. American Realty Investors
Performance |
| Timeline |
| AMREP |
| American Realty Investors |
AMREP and American Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMREP and American Realty
The main advantage of trading using opposite AMREP and American Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMREP position performs unexpectedly, American Realty 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 American Realty will offset losses from the drop in American Realty's long position.| AMREP vs. Landsea Homes Corp | AMREP vs. Forestar Group | AMREP vs. Five Point Holdings | AMREP vs. American Realty Investors |
| American Realty vs. Forestar Group | American Realty vs. Landsea Homes Corp | American Realty vs. Five Point Holdings | American Realty vs. AMREP |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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