Correlation Between Addus HomeCare and Kimco Realty
Can any of the company-specific risk be diversified away by investing in both Addus HomeCare and Kimco 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 Addus HomeCare and Kimco Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Addus HomeCare and Kimco Realty, you can compare the effects of market volatilities on Addus HomeCare and Kimco 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 Addus HomeCare with a short position of Kimco Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Addus HomeCare and Kimco Realty.
Diversification Opportunities for Addus HomeCare and Kimco Realty
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Addus and Kimco is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Addus HomeCare and Kimco Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kimco Realty and Addus HomeCare 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 Addus HomeCare are associated (or correlated) with Kimco Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kimco Realty has no effect on the direction of Addus HomeCare i.e., Addus HomeCare and Kimco Realty go up and down completely randomly.
Pair Corralation between Addus HomeCare and Kimco Realty
Given the investment horizon of 90 days Addus HomeCare is expected to generate 2.07 times more return on investment than Kimco Realty. However, Addus HomeCare is 2.07 times more volatile than Kimco Realty. It trades about 0.03 of its potential returns per unit of risk. Kimco Realty is currently generating about 0.05 per unit of risk. If you would invest 10,946 in Addus HomeCare on October 25, 2024 and sell it today you would earn a total of 2,320 from holding Addus HomeCare or generate 21.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.39% |
| Values | Daily Returns |
Addus HomeCare vs. Kimco Realty
Performance |
| Timeline |
| Addus HomeCare |
| Kimco Realty |
Addus HomeCare and Kimco Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Addus HomeCare and Kimco Realty
The main advantage of trading using opposite Addus HomeCare and Kimco Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Addus HomeCare position performs unexpectedly, Kimco 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 Kimco Realty will offset losses from the drop in Kimco Realty's long position.| Addus HomeCare vs. Encompass Health Corp | Addus HomeCare vs. Pennant Group | Addus HomeCare vs. Acadia Healthcare | Addus HomeCare vs. Select Medical Holdings |
| Kimco Realty vs. HomeTrust Bancshares | Kimco Realty vs. Taylor Morn Home | Kimco Realty vs. ServiceNow | Kimco Realty vs. Lowes Companies |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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