Correlation Between Cedar Realty and MYR
Can any of the company-specific risk be diversified away by investing in both Cedar Realty and MYR 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 MYR 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 MYR Group, you can compare the effects of market volatilities on Cedar Realty and MYR 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 MYR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cedar Realty and MYR.
Diversification Opportunities for Cedar Realty and MYR
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cedar and MYR is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Cedar Realty Trust and MYR Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MYR Group 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 MYR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MYR Group has no effect on the direction of Cedar Realty i.e., Cedar Realty and MYR go up and down completely randomly.
Pair Corralation between Cedar Realty and MYR
Assuming the 90 days trading horizon Cedar Realty is expected to generate 5.57 times less return on investment than MYR. But when comparing it to its historical volatility, Cedar Realty Trust is 1.85 times less risky than MYR. It trades about 0.11 of its potential returns per unit of risk. MYR Group is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 11,676 in MYR Group on August 27, 2024 and sell it today you would earn a total of 3,429 from holding MYR Group or generate 29.37% 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. MYR Group
Performance |
| Timeline |
| Cedar Realty Trust |
| MYR Group |
Cedar Realty and MYR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cedar Realty and MYR
The main advantage of trading using opposite Cedar Realty and MYR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cedar Realty position performs unexpectedly, MYR 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 MYR will offset losses from the drop in MYR's long position.| Cedar Realty vs. Saul Centers | Cedar Realty vs. Wheeler Real Estate | Cedar Realty vs. Macerich Company | Cedar Realty vs. Simon Property Group |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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