Correlation Between Coupang LLC and Cedar Realty
Can any of the company-specific risk be diversified away by investing in both Coupang LLC and Cedar Realty 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 Coupang LLC and Cedar Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coupang LLC and Cedar Realty Trust, you can compare the effects of market volatilities on Coupang LLC and Cedar Realty 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 Coupang LLC with a short position of Cedar Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coupang LLC and Cedar Realty.
Diversification Opportunities for Coupang LLC and Cedar Realty
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Coupang and Cedar is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Coupang LLC and Cedar Realty Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cedar Realty Trust and Coupang LLC 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 Coupang LLC are associated (or correlated) with Cedar Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cedar Realty Trust has no effect on the direction of Coupang LLC i.e., Coupang LLC and Cedar Realty go up and down completely randomly.
Pair Corralation between Coupang LLC and Cedar Realty
Given the investment horizon of 90 days Coupang LLC is expected to under-perform the Cedar Realty. In addition to that, Coupang LLC is 1.62 times more volatile than Cedar Realty Trust. It trades about -0.03 of its total potential returns per unit of risk. Cedar Realty Trust is currently generating about 0.16 per unit of volatility. If you would invest 1,512 in Cedar Realty Trust on August 27, 2024 and sell it today you would earn a total of 108.00 from holding Cedar Realty Trust or generate 7.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coupang LLC vs. Cedar Realty Trust
Performance |
| Timeline |
| Coupang LLC |
| Cedar Realty Trust |
Coupang LLC and Cedar Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coupang LLC and Cedar Realty
The main advantage of trading using opposite Coupang LLC and Cedar Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coupang LLC position performs unexpectedly, Cedar Realty 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 Cedar Realty will offset losses from the drop in Cedar Realty's long position.| Coupang LLC vs. MercadoLibre | Coupang LLC vs. PDD Holdings | Coupang LLC vs. JD Inc Adr | Coupang LLC vs. Alibaba Group Holding |
| 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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