Correlation Between Acadia Realty and Cedar Realty

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Can any of the company-specific risk be diversified away by investing in both Acadia Realty 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 Acadia Realty and Cedar Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acadia Realty Trust and Cedar Realty Trust, you can compare the effects of market volatilities on Acadia Realty 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 Acadia Realty with a short position of Cedar Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acadia Realty and Cedar Realty.

Diversification Opportunities for Acadia Realty and Cedar Realty

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  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Acadia and Cedar is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Acadia Realty Trust 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 Acadia 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 Acadia Realty Trust 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 Acadia Realty i.e., Acadia Realty and Cedar Realty go up and down completely randomly.

Pair Corralation between Acadia Realty and Cedar Realty

If you would invest  1,661  in Acadia Realty Trust on December 29, 2023 and sell it today you would earn a total of  9.00  from holding Acadia Realty Trust or generate 0.54% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Acadia Realty Trust  vs.  Cedar Realty Trust

 Performance 
       Timeline  
Acadia Realty Trust 

Risk-Adjusted Performance

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Very Weak
Over the last 90 days Acadia Realty Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable forward-looking signals, Acadia Realty is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.
Cedar Realty Trust 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days Cedar Realty Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable fundamental indicators, Cedar Realty is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Acadia Realty and Cedar Realty Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Acadia Realty and Cedar Realty

The main advantage of trading using opposite Acadia Realty and Cedar Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acadia Realty 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 Acadia Realty Trust 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.

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