Correlation Between BRT Realty and American Campus
Can any of the company-specific risk be diversified away by investing in both BRT Realty and American Campus 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 BRT Realty and American Campus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BRT Realty Trust and American Campus Communities, you can compare the effects of market volatilities on BRT Realty and American Campus 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 BRT Realty with a short position of American Campus. Check out your portfolio center. Please also check ongoing floating volatility patterns of BRT Realty and American Campus.
Diversification Opportunities for BRT Realty and American Campus
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BRT and American is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding BRT Realty Trust and American Campus Communities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Campus Comm and BRT 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 BRT Realty Trust are associated (or correlated) with American Campus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Campus Comm has no effect on the direction of BRT Realty i.e., BRT Realty and American Campus go up and down completely randomly.
Pair Corralation between BRT Realty and American Campus
Considering the 90-day investment horizon BRT Realty Trust is expected to under-perform the American Campus. In addition to that, BRT Realty is 8.39 times more volatile than American Campus Communities. It trades about 0.0 of its total potential returns per unit of risk. American Campus Communities is currently generating about 0.06 per unit of volatility. If you would invest 6,475 in American Campus Communities on January 20, 2024 and sell it today you would earn a total of 67.00 from holding American Campus Communities or generate 1.03% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 14.14% |
Values | Daily Returns |
BRT Realty Trust vs. American Campus Communities
Performance |
Timeline |
BRT Realty Trust |
American Campus Comm |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
BRT Realty and American Campus Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with BRT Realty and American Campus
The main advantage of trading using opposite BRT Realty and American Campus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BRT Realty position performs unexpectedly, American Campus 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 American Campus will offset losses from the drop in American Campus' long position.BRT Realty vs. Nexpoint Residential Trust | BRT Realty vs. Centerspace | BRT Realty vs. Veris Residential | BRT Realty vs. Apartment Income REIT |
American Campus vs. Ardelyx | American Campus vs. Molecular Partners AG | American Campus vs. Tscan Therapeutics | American Campus vs. Albemarle Corp |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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