Correlation Between Chicago Atlantic and Newlake Capital
Can any of the company-specific risk be diversified away by investing in both Chicago Atlantic and Newlake Capital 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 Chicago Atlantic and Newlake Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chicago Atlantic Real and Newlake Capital Partners, you can compare the effects of market volatilities on Chicago Atlantic and Newlake Capital 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 Chicago Atlantic with a short position of Newlake Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chicago Atlantic and Newlake Capital.
Diversification Opportunities for Chicago Atlantic and Newlake Capital
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Chicago and Newlake is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Chicago Atlantic Real and Newlake Capital Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newlake Capital Partners and Chicago Atlantic 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 Chicago Atlantic Real are associated (or correlated) with Newlake Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Newlake Capital Partners has no effect on the direction of Chicago Atlantic i.e., Chicago Atlantic and Newlake Capital go up and down completely randomly.
Pair Corralation between Chicago Atlantic and Newlake Capital
Given the investment horizon of 90 days Chicago Atlantic Real is expected to generate 0.43 times more return on investment than Newlake Capital. However, Chicago Atlantic Real is 2.33 times less risky than Newlake Capital. It trades about 0.21 of its potential returns per unit of risk. Newlake Capital Partners is currently generating about -0.1 per unit of risk. If you would invest 1,539 in Chicago Atlantic Real on August 24, 2024 and sell it today you would earn a total of 58.00 from holding Chicago Atlantic Real or generate 3.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chicago Atlantic Real vs. Newlake Capital Partners
Performance |
| Timeline |
| Chicago Atlantic Real |
| Newlake Capital Partners |
Chicago Atlantic and Newlake Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chicago Atlantic and Newlake Capital
The main advantage of trading using opposite Chicago Atlantic and Newlake Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chicago Atlantic position performs unexpectedly, Newlake Capital 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 Newlake Capital will offset losses from the drop in Newlake Capital's long position.| Chicago Atlantic vs. KKR Real Estate | Chicago Atlantic vs. Ellington Residential Mortgage | Chicago Atlantic vs. Claros Mortgage Trust | Chicago Atlantic vs. Great Ajax Corp |
| Newlake Capital vs. AFC Gamma | Newlake Capital vs. Alpineome Property Trust | Newlake Capital vs. Chicago Atlantic Real | Newlake Capital vs. Power REIT |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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