Correlation Between Ambev SA and Kite Realty
Can any of the company-specific risk be diversified away by investing in both Ambev SA and Kite Realty 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 Ambev SA and Kite Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ambev SA ADR and Kite Realty Group, you can compare the effects of market volatilities on Ambev SA and Kite Realty 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 Ambev SA with a short position of Kite Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ambev SA and Kite Realty.
Diversification Opportunities for Ambev SA and Kite Realty
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ambev and Kite is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Ambev SA ADR and Kite Realty Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kite Realty Group and Ambev SA 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 Ambev SA ADR are associated (or correlated) with Kite Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kite Realty Group has no effect on the direction of Ambev SA i.e., Ambev SA and Kite Realty go up and down completely randomly.
Pair Corralation between Ambev SA and Kite Realty
Given the investment horizon of 90 days Ambev SA ADR is expected to under-perform the Kite Realty. In addition to that, Ambev SA is 1.21 times more volatile than Kite Realty Group. It trades about -0.06 of its total potential returns per unit of risk. Kite Realty Group is currently generating about 0.09 per unit of volatility. If you would invest 2,095 in Kite Realty Group on September 2, 2024 and sell it today you would earn a total of 662.00 from holding Kite Realty Group or generate 31.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ambev SA ADR vs. Kite Realty Group
Performance |
| Timeline |
| Ambev SA ADR |
| Kite Realty Group |
Ambev SA and Kite Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ambev SA and Kite Realty
The main advantage of trading using opposite Ambev SA and Kite Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ambev SA position performs unexpectedly, Kite Realty 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 Kite Realty will offset losses from the drop in Kite Realty's long position.| Ambev SA vs. Compania Cervecerias Unidas | Ambev SA vs. Molson Coors Brewing | Ambev SA vs. Suntory Beverage Food | Ambev SA vs. Carlsberg AS |
| Kite Realty vs. Site Centers Corp | Kite Realty vs. CBL Associates Properties | Kite Realty vs. Urban Edge Properties | Kite Realty vs. Acadia Realty Trust |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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