Correlation Between Sachem Capital and ACRES Commercial
Can any of the company-specific risk be diversified away by investing in both Sachem Capital and ACRES Commercial 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 Sachem Capital and ACRES Commercial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sachem Capital Corp and ACRES Commercial Realty, you can compare the effects of market volatilities on Sachem Capital and ACRES Commercial 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 Sachem Capital with a short position of ACRES Commercial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sachem Capital and ACRES Commercial.
Diversification Opportunities for Sachem Capital and ACRES Commercial
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sachem and ACRES is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Sachem Capital Corp and ACRES Commercial Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ACRES Commercial Realty and Sachem Capital 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 Sachem Capital Corp are associated (or correlated) with ACRES Commercial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ACRES Commercial Realty has no effect on the direction of Sachem Capital i.e., Sachem Capital and ACRES Commercial go up and down completely randomly.
Pair Corralation between Sachem Capital and ACRES Commercial
Assuming the 90 days trading horizon Sachem Capital Corp is expected to under-perform the ACRES Commercial. In addition to that, Sachem Capital is 2.76 times more volatile than ACRES Commercial Realty. It trades about -0.34 of its total potential returns per unit of risk. ACRES Commercial Realty is currently generating about 0.0 per unit of volatility. If you would invest 2,301 in ACRES Commercial Realty on September 12, 2024 and sell it today you would lose (1.00) from holding ACRES Commercial Realty or give up 0.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sachem Capital Corp vs. ACRES Commercial Realty
Performance |
| Timeline |
| Sachem Capital Corp |
| ACRES Commercial Realty |
Sachem Capital and ACRES Commercial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sachem Capital and ACRES Commercial
The main advantage of trading using opposite Sachem Capital and ACRES Commercial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sachem Capital position performs unexpectedly, ACRES Commercial 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 ACRES Commercial will offset losses from the drop in ACRES Commercial's long position.| Sachem Capital vs. SiriusPoint | Sachem Capital vs. Harrow Health 8625 | Sachem Capital vs. XOMA Corporation | Sachem Capital vs. New York Mortgage |
| ACRES Commercial vs. ACRES Commercial Realty | ACRES Commercial vs. Dynex Capital | ACRES Commercial vs. PennyMac Mortgage Investment | ACRES Commercial vs. AG Mortgage Investment |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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