Correlation Between Sphere Entertainment and Cedar Realty
Can any of the company-specific risk be diversified away by investing in both Sphere Entertainment 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 Sphere Entertainment and Cedar Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sphere Entertainment Co and Cedar Realty Trust, you can compare the effects of market volatilities on Sphere Entertainment 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 Sphere Entertainment with a short position of Cedar Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sphere Entertainment and Cedar Realty.
Diversification Opportunities for Sphere Entertainment and Cedar Realty
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sphere and Cedar is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Sphere Entertainment Co 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 Sphere Entertainment 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 Sphere Entertainment Co 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 Sphere Entertainment i.e., Sphere Entertainment and Cedar Realty go up and down completely randomly.
Pair Corralation between Sphere Entertainment and Cedar Realty
Given the investment horizon of 90 days Sphere Entertainment Co is expected to under-perform the Cedar Realty. In addition to that, Sphere Entertainment is 1.25 times more volatile than Cedar Realty Trust. It trades about -0.02 of its total potential returns per unit of risk. Cedar Realty Trust is currently generating about 0.18 per unit of volatility. If you would invest 1,534 in Cedar Realty Trust on September 1, 2024 and sell it today you would earn a total of 104.00 from holding Cedar Realty Trust or generate 6.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sphere Entertainment Co vs. Cedar Realty Trust
Performance |
| Timeline |
| Sphere Entertainment |
| Cedar Realty Trust |
Sphere Entertainment and Cedar Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sphere Entertainment and Cedar Realty
The main advantage of trading using opposite Sphere Entertainment and Cedar Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sphere Entertainment 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.| Sphere Entertainment vs. JD Sports Fashion | Sphere Entertainment vs. Sun Country Airlines | Sphere Entertainment vs. SFL Corporation | Sphere Entertainment vs. Sabre Corpo |
| Cedar Realty vs. Site Centers Corp | Cedar Realty vs. Urban Edge Properties | Cedar Realty vs. Retail Opportunity Investments | Cedar Realty vs. Brixmor Property |
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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