Correlation Between Apartment Investment and Bluerock Residential

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

Diversification Opportunities for Apartment Investment and Bluerock Residential

0.37
  Correlation Coefficient

Weak diversification

The 4 months correlation between Apartment and Bluerock is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Apartment Investment And and Bluerock Residential Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bluerock Residential and Apartment Investment 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 Apartment Investment And are associated (or correlated) with Bluerock Residential. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bluerock Residential has no effect on the direction of Apartment Investment i.e., Apartment Investment and Bluerock Residential go up and down completely randomly.

Pair Corralation between Apartment Investment and Bluerock Residential

Considering the 90-day investment horizon Apartment Investment is expected to generate 2.21 times less return on investment than Bluerock Residential. But when comparing it to its historical volatility, Apartment Investment And is 1.4 times less risky than Bluerock Residential. It trades about 0.05 of its potential returns per unit of risk. Bluerock Residential Growth is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  675.00  in Bluerock Residential Growth on April 6, 2022 and sell it today you would earn a total of  1,944  from holding Bluerock Residential Growth or generate 288.0% return on investment over 90 days.
Time Period4 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Apartment Investment And  vs.  Bluerock Residential Growth

 Performance (%) 
      Timeline 
Apartment Investment And 
Apartment Performance
0 of 100
Over the last 90 days Apartment Investment And has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable forward indicators, Apartment Investment is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Structure and Payout Changes

Forward Annual Dividend Yield
0.0545
Last Split Factor
9295:1000
Forward Annual Dividend Rate
2.03
Dividend Date
2020-11-30
Ex Dividend Date
2020-11-03
Last Split Date
2020-12-15

Apartment Price Channel

Bluerock Residential 
Bluerock Performance
0 of 100
Over the last 90 days Bluerock Residential Growth has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Bluerock Residential is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Structure and Payout Changes

Forward Annual Dividend Yield
0.0247
Last Split Factor
10:1
Forward Annual Dividend Rate
0.65
Dividend Date
2022-07-05
Ex Dividend Date
2022-06-23
Last Split Date
2010-05-17

Bluerock Price Channel

Apartment Investment and Bluerock Residential Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Apartment Investment and Bluerock Residential

The main advantage of trading using opposite Apartment Investment and Bluerock Residential positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apartment Investment position performs unexpectedly, Bluerock Residential 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 Bluerock Residential will offset losses from the drop in Bluerock Residential's long position.
The idea behind Apartment Investment And and Bluerock Residential Growth 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.
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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