Correlation Between Cedar Realty and STAG Industrial
Can any of the company-specific risk be diversified away by investing in both Cedar Realty and STAG Industrial 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 STAG Industrial 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 STAG Industrial, you can compare the effects of market volatilities on Cedar Realty and STAG Industrial 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 STAG Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cedar Realty and STAG Industrial.
Diversification Opportunities for Cedar Realty and STAG Industrial
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cedar and STAG is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Cedar Realty Trust and STAG Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STAG Industrial 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 STAG Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STAG Industrial has no effect on the direction of Cedar Realty i.e., Cedar Realty and STAG Industrial go up and down completely randomly.
Pair Corralation between Cedar Realty and STAG Industrial
Assuming the 90 days trading horizon Cedar Realty Trust is expected to generate 0.8 times more return on investment than STAG Industrial. However, Cedar Realty Trust is 1.24 times less risky than STAG Industrial. It trades about 0.12 of its potential returns per unit of risk. STAG Industrial is currently generating about -0.03 per unit of risk. If you would invest 1,375 in Cedar Realty Trust on August 31, 2024 and sell it today you would earn a total of 35.00 from holding Cedar Realty Trust or generate 2.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cedar Realty Trust vs. STAG Industrial
Performance |
| Timeline |
| Cedar Realty Trust |
| STAG Industrial |
Cedar Realty and STAG Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cedar Realty and STAG Industrial
The main advantage of trading using opposite Cedar Realty and STAG Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cedar Realty position performs unexpectedly, STAG Industrial 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 STAG Industrial will offset losses from the drop in STAG Industrial's long position.| Cedar Realty vs. Wheeler Real Estate | Cedar Realty vs. CBL Associates Properties | Cedar Realty vs. Saul Centers | Cedar Realty vs. Federal Realty Investment |
| STAG Industrial vs. Public Storage | STAG Industrial vs. Extra Space Storage | STAG Industrial vs. Rexford Industrial Realty | STAG Industrial vs. Innovative Industrial Properties |
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 Stocks Directory module to find actively traded stocks across global markets.
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