Correlation Between Bluerock Residential and Mid America
Can any of the company-specific risk be diversified away by investing in both Bluerock Residential and Mid America 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 Bluerock Residential and Mid America into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bluerock Residential Growth and Mid America Apartment Communities, you can compare the effects of market volatilities on Bluerock Residential and Mid America 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 Bluerock Residential with a short position of Mid America. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bluerock Residential and Mid America.
Diversification Opportunities for Bluerock Residential and Mid America
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Bluerock and Mid is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Bluerock Residential Growth and Mid America Apartment Communit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mid America Apartment and Bluerock Residential 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 Bluerock Residential Growth are associated (or correlated) with Mid America. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mid America Apartment has no effect on the direction of Bluerock Residential i.e., Bluerock Residential and Mid America go up and down completely randomly.
Pair Corralation between Bluerock Residential and Mid America
Considering the 90-day investment horizon Bluerock Residential Growth is expected to generate 0.54 times more return on investment than Mid America. However, Bluerock Residential Growth is 1.87 times less risky than Mid America. It trades about 0.01 of its potential returns per unit of risk. Mid America Apartment Communities is currently generating about -0.04 per unit of risk. If you would invest 2,638 in Bluerock Residential Growth on January 20, 2024 and sell it today you would earn a total of 22.00 from holding Bluerock Residential Growth or generate 0.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 22.22% |
| Values | Daily Returns |
Bluerock Residential Growth vs. Mid America Apartment Communit
Performance |
| Timeline |
| Bluerock Residential |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Mid America Apartment |
Bluerock Residential and Mid America Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bluerock Residential and Mid America
The main advantage of trading using opposite Bluerock Residential and Mid America positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bluerock Residential position performs unexpectedly, Mid America 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 Mid America will offset losses from the drop in Mid America's long position.| Bluerock Residential vs. US GoldMining Common | Bluerock Residential vs. Sphere Entertainment Co | Bluerock Residential vs. Integrated Media Technology | Bluerock Residential vs. WT Offshore |
| Mid America vs. AvalonBay Communities | Mid America vs. Essex Property Trust | Mid America vs. Equity Residential | Mid America vs. UDR Inc |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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