Correlation Between Cedar Realty and Mativ Holdings
Can any of the company-specific risk be diversified away by investing in both Cedar Realty and Mativ Holdings 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 Cedar Realty and Mativ Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cedar Realty Trust and Mativ Holdings, you can compare the effects of market volatilities on Cedar Realty and Mativ Holdings 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 Cedar Realty with a short position of Mativ Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cedar Realty and Mativ Holdings.
Diversification Opportunities for Cedar Realty and Mativ Holdings
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cedar and Mativ is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Cedar Realty Trust and Mativ Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mativ Holdings and Cedar Realty 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 Cedar Realty Trust are associated (or correlated) with Mativ Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mativ Holdings has no effect on the direction of Cedar Realty i.e., Cedar Realty and Mativ Holdings go up and down completely randomly.
Pair Corralation between Cedar Realty and Mativ Holdings
Assuming the 90 days trading horizon Cedar Realty Trust is expected to generate 0.78 times more return on investment than Mativ Holdings. However, Cedar Realty Trust is 1.29 times less risky than Mativ Holdings. It trades about 0.11 of its potential returns per unit of risk. Mativ Holdings is currently generating about -0.33 per unit of risk. If you would invest 1,581 in Cedar Realty Trust on December 5, 2024 and sell it today you would earn a total of 129.00 from holding Cedar Realty Trust or generate 8.16% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Cedar Realty Trust vs. Mativ Holdings
Performance |
Timeline |
Cedar Realty Trust |
Mativ Holdings |
Cedar Realty and Mativ Holdings Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Cedar Realty and Mativ Holdings
The main advantage of trading using opposite Cedar Realty and Mativ Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cedar Realty position performs unexpectedly, Mativ Holdings 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 Mativ Holdings will offset losses from the drop in Mativ Holdings' long position.Cedar Realty vs. Saul Centers | Cedar Realty vs. Kimco Realty | Cedar Realty vs. Wheeler Real Estate | Cedar Realty vs. Macerich Company |
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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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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