Correlation Between BW Offshore and Kite Realty
Can any of the company-specific risk be diversified away by investing in both BW Offshore 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 BW Offshore and Kite Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BW Offshore Limited and Kite Realty Group, you can compare the effects of market volatilities on BW Offshore 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 BW Offshore with a short position of Kite Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of BW Offshore and Kite Realty.
Diversification Opportunities for BW Offshore and Kite Realty
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BWOFY and Kite is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding BW Offshore Limited 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 BW Offshore 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 BW Offshore Limited 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 BW Offshore i.e., BW Offshore and Kite Realty go up and down completely randomly.
Pair Corralation between BW Offshore and Kite Realty
Assuming the 90 days horizon BW Offshore Limited is expected to generate 0.83 times more return on investment than Kite Realty. However, BW Offshore Limited is 1.2 times less risky than Kite Realty. It trades about 0.2 of its potential returns per unit of risk. Kite Realty Group is currently generating about -0.2 per unit of risk. If you would invest 538.00 in BW Offshore Limited on September 13, 2024 and sell it today you would earn a total of 17.00 from holding BW Offshore Limited or generate 3.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BW Offshore Limited vs. Kite Realty Group
Performance |
| Timeline |
| BW Offshore Limited |
| Kite Realty Group |
BW Offshore and Kite Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BW Offshore and Kite Realty
The main advantage of trading using opposite BW Offshore and Kite Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BW Offshore 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.| BW Offshore vs. Legacy Education | BW Offshore vs. Apple Inc | BW Offshore vs. NVIDIA | BW Offshore vs. Microsoft |
| 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 CEOs Directory module to screen CEOs from public companies around the world.
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