Correlation Between Alexanders and Cherry Hill

Can any of the company-specific risk be diversified away by investing in both Alexanders and Cherry Hill 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 Alexanders and Cherry Hill into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Alexanders and Cherry Hill Mortgage, you can compare the effects of market volatilities on Alexanders and Cherry Hill 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 Alexanders with a short position of Cherry Hill. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alexanders and Cherry Hill.

Diversification Opportunities for Alexanders and Cherry Hill

0.83

Correlation Coefficient

Alexanders  Cherry Hill

Very poor diversification

The 3 months correlation between Alexanders and Cherry is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Alexanders and Cherry Hill Mortgage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cherry Hill Mortgage and Alexanders 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 Alexanders are associated (or correlated) with Cherry Hill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cherry Hill Mortgage has no effect on the direction of Alexanders i.e., Alexanders and Cherry Hill go up and down completely randomly.

Pair Corralation between Alexanders and Cherry Hill

Considering the 90-day investment horizon Alexanders is expected to generate 2.04 times more return on investment than Cherry Hill. However, Alexanders is 2.04 times more volatile than Cherry Hill Mortgage. It trades about 0.19 of its potential returns per unit of risk. Cherry Hill Mortgage is currently generating about 0.09 per unit of risk. If you would invest  20,840  in Alexanders on May 4, 2025 and sell it today you would earn a total of  3,685  from holding Alexanders or generate 17.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Alexanders  vs.  Cherry Hill Mortgage

Alexanders

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Alexanders are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak essential indicators, Alexanders showed solid returns over the last few months and may actually be approaching a breakup point.

Cherry Hill Mortgage

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Cherry Hill Mortgage are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental drivers, Cherry Hill is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Alexanders and Cherry Hill

The main advantage of trading using opposite Alexanders and Cherry Hill positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alexanders position performs unexpectedly, Cherry Hill 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 Cherry Hill will offset losses from the drop in Cherry Hill's long position.

The idea behind Alexanders and Cherry Hill Mortgage 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.