Correlation Between Granite Falls and Cedar Realty
Can any of the company-specific risk be diversified away by investing in both Granite Falls 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 Granite Falls and Cedar Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Granite Falls Energy and Cedar Realty Trust, you can compare the effects of market volatilities on Granite Falls 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 Granite Falls with a short position of Cedar Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Granite Falls and Cedar Realty.
Diversification Opportunities for Granite Falls and Cedar Realty
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Granite and Cedar is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Granite Falls Energy 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 Granite Falls 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 Granite Falls Energy 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 Granite Falls i.e., Granite Falls and Cedar Realty go up and down completely randomly.
Pair Corralation between Granite Falls and Cedar Realty
Given the investment horizon of 90 days Granite Falls Energy is expected to under-perform the Cedar Realty. But the pink sheet apears to be less risky and, when comparing its historical volatility, Granite Falls Energy is 1.92 times less risky than Cedar Realty. The pink sheet trades about -0.07 of its potential returns per unit of risk. The Cedar Realty Trust is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,328 in Cedar Realty Trust on September 13, 2024 and sell it today you would earn a total of 320.00 from holding Cedar Realty Trust or generate 24.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Granite Falls Energy vs. Cedar Realty Trust
Performance |
| Timeline |
| Granite Falls Energy |
| Cedar Realty Trust |
Granite Falls and Cedar Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Granite Falls and Cedar Realty
The main advantage of trading using opposite Granite Falls and Cedar Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Granite Falls 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.| Granite Falls vs. NuRAN Wireless | Granite Falls vs. Microbot Medical | Granite Falls vs. GAMCO Global Gold | Granite Falls vs. Weyco Group |
| Cedar Realty vs. Simon Property Group | Cedar Realty vs. Saul Centers | Cedar Realty vs. Rithm Property Trust | Cedar Realty vs. Urban Edge 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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