Correlation Between 302635AK3 and Cedar Realty

Can any of the company-specific risk be diversified away by investing in both 302635AK3 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 302635AK3 and Cedar Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FSK 3125 12 OCT 28 and Cedar Realty Trust, you can compare the effects of market volatilities on 302635AK3 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 302635AK3 with a short position of Cedar Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of 302635AK3 and Cedar Realty.

Diversification Opportunities for 302635AK3 and Cedar Realty

0.43

Correlation Coefficient

302635AK3  Cedar Realty

Very weak diversification

The 3 months correlation between 302635AK3 and Cedar is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding FSK 3125 12 OCT 28 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 302635AK3 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 FSK 3125 12 OCT 28 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 302635AK3 i.e., 302635AK3 and Cedar Realty go up and down completely randomly.

Pair Corralation between 302635AK3 and Cedar Realty

Assuming the 90 days trading horizon 302635AK3 is expected to generate 15.73 times less return on investment than Cedar Realty. But when comparing it to its historical volatility, FSK 3125 12 OCT 28 is 3.7 times less risky than Cedar Realty. It trades about 0.01 of its potential returns per unit of risk. Cedar Realty Trust is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1,236  in Cedar Realty Trust on October 4, 2024 and sell it today you would earn a total of  264.00  from holding Cedar Realty Trust or generate 21.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	94.55%
Values	Daily Returns

FSK 3125 12 OCT 28  vs.  Cedar Realty Trust

FSK 3125 12

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days FSK 3125 12 OCT 28 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for FSK 3125 12 OCT 28 investors.

Cedar Realty Trust

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cedar Realty Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Cedar Realty is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with 302635AK3 and Cedar Realty

The main advantage of trading using opposite 302635AK3 and Cedar Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 302635AK3 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.

The idea behind FSK 3125 12 OCT 28 and Cedar Realty Trust pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.