Correlation Between Armada Hflr and South Atlantic
Can any of the company-specific risk be diversified away by investing in both Armada Hflr and South Atlantic 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 Armada Hflr and South Atlantic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Armada Hflr Pr and South Atlantic Bancshares, you can compare the effects of market volatilities on Armada Hflr and South Atlantic 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 Armada Hflr with a short position of South Atlantic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and South Atlantic.
Diversification Opportunities for Armada Hflr and South Atlantic
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Armada and South is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and South Atlantic Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on South Atlantic Bancshares and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with South Atlantic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of South Atlantic Bancshares has no effect on the direction of Armada Hflr i.e., Armada Hflr and South Atlantic go up and down completely randomly.
Pair Corralation between Armada Hflr and South Atlantic
Considering the 90-day investment horizon Armada Hflr Pr is expected to under-perform the South Atlantic. In addition to that, Armada Hflr is 1.48 times more volatile than South Atlantic Bancshares. It trades about -0.17 of its total potential returns per unit of risk. South Atlantic Bancshares is currently generating about -0.18 per unit of volatility. If you would invest 1,559 in South Atlantic Bancshares on December 5, 2024 and sell it today you would lose (109.00) from holding South Atlantic Bancshares or give up 6.99% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Armada Hflr Pr vs. South Atlantic Bancshares
Performance |
Timeline |
Armada Hflr Pr |
South Atlantic Bancshares |
Armada Hflr and South Atlantic Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Armada Hflr and South Atlantic
The main advantage of trading using opposite Armada Hflr and South Atlantic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Armada Hflr position performs unexpectedly, South Atlantic 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 South Atlantic will offset losses from the drop in South Atlantic's long position.Armada Hflr vs. Modiv Inc | Armada Hflr vs. Precinct Properties New | Armada Hflr vs. Global Net Lease | Armada Hflr vs. NexPoint Diversified Real |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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