Correlation Between Cedar Realty and Deluxe
Can any of the company-specific risk be diversified away by investing in both Cedar Realty and Deluxe 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 Cedar Realty and Deluxe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cedar Realty Trust and Deluxe, you can compare the effects of market volatilities on Cedar Realty and Deluxe 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 Cedar Realty with a short position of Deluxe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cedar Realty and Deluxe.
Diversification Opportunities for Cedar Realty and Deluxe
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cedar and Deluxe is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Cedar Realty Trust and Deluxe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deluxe and Cedar 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 Cedar Realty Trust are associated (or correlated) with Deluxe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deluxe has no effect on the direction of Cedar Realty i.e., Cedar Realty and Deluxe go up and down completely randomly.
Pair Corralation between Cedar Realty and Deluxe
Assuming the 90 days trading horizon Cedar Realty Trust is expected to generate 1.95 times more return on investment than Deluxe. However, Cedar Realty is 1.95 times more volatile than Deluxe. It trades about 0.06 of its potential returns per unit of risk. Deluxe is currently generating about 0.03 per unit of risk. If you would invest 1,630 in Cedar Realty Trust on September 19, 2024 and sell it today you would earn a total of 40.00 from holding Cedar Realty Trust or generate 2.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cedar Realty Trust vs. Deluxe
Performance |
| Timeline |
| Cedar Realty Trust |
| Deluxe |
Cedar Realty and Deluxe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cedar Realty and Deluxe
The main advantage of trading using opposite Cedar Realty and Deluxe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cedar Realty position performs unexpectedly, Deluxe 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 Deluxe will offset losses from the drop in Deluxe's long position.| Cedar Realty vs. Simon Property Group | Cedar Realty vs. Saul Centers | Cedar Realty vs. Rithm Property Trust | Cedar Realty vs. Urban Edge Properties |
| Deluxe vs. Criteo Sa | Deluxe vs. Emerald Expositions Events | Deluxe vs. Marchex | Deluxe vs. Integral Ad Science |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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