Correlation Between Cedar Realty and Eureka Acquisition
Can any of the company-specific risk be diversified away by investing in both Cedar Realty and Eureka Acquisition 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 Eureka Acquisition 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 Eureka Acquisition Corp, you can compare the effects of market volatilities on Cedar Realty and Eureka Acquisition 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 Eureka Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cedar Realty and Eureka Acquisition.
Diversification Opportunities for Cedar Realty and Eureka Acquisition
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Cedar and Eureka is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Cedar Realty Trust and Eureka Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eureka Acquisition Corp 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 Eureka Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eureka Acquisition Corp has no effect on the direction of Cedar Realty i.e., Cedar Realty and Eureka Acquisition go up and down completely randomly.
Pair Corralation between Cedar Realty and Eureka Acquisition
Assuming the 90 days trading horizon Cedar Realty Trust is expected to generate 73.01 times more return on investment than Eureka Acquisition. However, Cedar Realty is 73.01 times more volatile than Eureka Acquisition Corp. It trades about 0.43 of its potential returns per unit of risk. Eureka Acquisition Corp is currently generating about 0.34 per unit of risk. If you would invest 1,403 in Cedar Realty Trust on October 25, 2024 and sell it today you would earn a total of 270.00 from holding Cedar Realty Trust or generate 19.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cedar Realty Trust vs. Eureka Acquisition Corp
Performance |
| Timeline |
| Cedar Realty Trust |
| Eureka Acquisition Corp |
Cedar Realty and Eureka Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cedar Realty and Eureka Acquisition
The main advantage of trading using opposite Cedar Realty and Eureka Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cedar Realty position performs unexpectedly, Eureka Acquisition 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 Eureka Acquisition will offset losses from the drop in Eureka Acquisition's long position.| Cedar Realty vs. Saul Centers | Cedar Realty vs. Kimco Realty | Cedar Realty vs. Wheeler Real Estate | Cedar Realty vs. Macerich Company |
| Eureka Acquisition vs. Galaxy Gaming | Eureka Acquisition vs. Tyson Foods | Eureka Acquisition vs. Hanover Foods | Eureka Acquisition vs. Fernhill Beverage |
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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