Correlation Between Mid America and American Campus
Can any of the company-specific risk be diversified away by investing in both Mid America 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 Mid America and American Campus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mid America Apartment Communities and American Campus Communities, you can compare the effects of market volatilities on Mid America 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 Mid America with a short position of American Campus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mid America and American Campus.
Diversification Opportunities for Mid America and American Campus
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Mid and American is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Mid-America Apartment Communit 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 Mid America 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 Mid America Apartment Communities 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 Mid America i.e., Mid America and American Campus go up and down completely randomly.
Pair Corralation between Mid America and American Campus
Considering the 90-day investment horizon Mid America Apartment Communities is expected to under-perform the American Campus. In addition to that, Mid America is 1.11 times more volatile than American Campus Communities. It trades about -0.05 of its total potential returns per unit of risk. American Campus Communities is currently generating about 0.12 per unit of volatility. If you would invest 5,673 in American Campus Communities on December 20, 2023 and sell it today you would earn a total of 869.00 from holding American Campus Communities or generate 15.32% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 18.62% |
Values | Daily Returns |
Mid-America Apartment Communit vs. American Campus Communities
Performance |
Timeline |
Mid-America Apartment |
American Campus Comm |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
Mid America and American Campus Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mid America and American Campus
The main advantage of trading using opposite Mid America and American Campus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mid America 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.Mid America vs. US Silica Holdings | Mid America vs. Lithium Americas Corp | Mid America vs. Comstock Metals | Mid America vs. Mitsui Mining And |
American Campus vs. ARCA Biopharma | American Campus vs. Regeneron Pharmaceuticals | American Campus vs. Eastman Chemical | American Campus vs. Hawkins |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
Fundamental Analysis View fundamental data based on most recent published financial statements | |
Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |