Correlation Between Cedar Realty and Olympic Steel
Can any of the company-specific risk be diversified away by investing in both Cedar Realty and Olympic Steel 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 Olympic Steel 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 Olympic Steel, you can compare the effects of market volatilities on Cedar Realty and Olympic Steel 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 Olympic Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cedar Realty and Olympic Steel.
Diversification Opportunities for Cedar Realty and Olympic Steel
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Cedar and Olympic is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Cedar Realty Trust and Olympic Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Olympic Steel 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 Olympic Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Olympic Steel has no effect on the direction of Cedar Realty i.e., Cedar Realty and Olympic Steel go up and down completely randomly.
Pair Corralation between Cedar Realty and Olympic Steel
Assuming the 90 days trading horizon Cedar Realty Trust is expected to generate 1.06 times more return on investment than Olympic Steel. However, Cedar Realty is 1.06 times more volatile than Olympic Steel. It trades about 0.04 of its potential returns per unit of risk. Olympic Steel is currently generating about 0.02 per unit of risk. If you would invest 1,135 in Cedar Realty Trust on August 24, 2024 and sell it today you would earn a total of 446.00 from holding Cedar Realty Trust or generate 39.3% 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. Olympic Steel
Performance |
| Timeline |
| Cedar Realty Trust |
| Olympic Steel |
Cedar Realty and Olympic Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cedar Realty and Olympic Steel
The main advantage of trading using opposite Cedar Realty and Olympic Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cedar Realty position performs unexpectedly, Olympic Steel 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 Olympic Steel will offset losses from the drop in Olympic Steel's long position.| Cedar Realty vs. Saul Centers | Cedar Realty vs. Kimco Realty | Cedar Realty vs. Wheeler Real Estate | Cedar Realty vs. Macerich Company |
| Olympic Steel vs. Universal Stainless Alloy | Olympic Steel vs. Outokumpu Oyj ADR | Olympic Steel vs. Usinas Siderurgicas de | Olympic Steel vs. POSCO Holdings |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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