Correlation Between CapitaLand Integrated and Retail Opportunity
Can any of the company-specific risk be diversified away by investing in both CapitaLand Integrated and Retail Opportunity 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 CapitaLand Integrated and Retail Opportunity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CapitaLand Integrated Commercial and Retail Opportunity Investments, you can compare the effects of market volatilities on CapitaLand Integrated and Retail Opportunity 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 CapitaLand Integrated with a short position of Retail Opportunity. Check out your portfolio center. Please also check ongoing floating volatility patterns of CapitaLand Integrated and Retail Opportunity.
Diversification Opportunities for CapitaLand Integrated and Retail Opportunity
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CapitaLand and Retail is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding CapitaLand Integrated Commerci and Retail Opportunity Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Retail Opportunity and CapitaLand Integrated 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 CapitaLand Integrated Commercial are associated (or correlated) with Retail Opportunity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Retail Opportunity has no effect on the direction of CapitaLand Integrated i.e., CapitaLand Integrated and Retail Opportunity go up and down completely randomly.
Pair Corralation between CapitaLand Integrated and Retail Opportunity
Assuming the 90 days horizon CapitaLand Integrated Commercial is expected to generate 19.34 times more return on investment than Retail Opportunity. However, CapitaLand Integrated is 19.34 times more volatile than Retail Opportunity Investments. It trades about 0.23 of its potential returns per unit of risk. Retail Opportunity Investments is currently generating about 0.34 per unit of risk. If you would invest 129.00 in CapitaLand Integrated Commercial on October 20, 2024 and sell it today you would earn a total of 20.00 from holding CapitaLand Integrated Commercial or generate 15.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CapitaLand Integrated Commerci vs. Retail Opportunity Investments
Performance |
| Timeline |
| CapitaLand Integrated |
| Retail Opportunity |
CapitaLand Integrated and Retail Opportunity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CapitaLand Integrated and Retail Opportunity
The main advantage of trading using opposite CapitaLand Integrated and Retail Opportunity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CapitaLand Integrated position performs unexpectedly, Retail Opportunity 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 Retail Opportunity will offset losses from the drop in Retail Opportunity's long position.| CapitaLand Integrated vs. Cedar Realty Trust | CapitaLand Integrated vs. Wheeler Real Estate | CapitaLand Integrated vs. Macerich Company | CapitaLand Integrated vs. Simon Property Group |
| Retail Opportunity vs. Kite Realty Group | Retail Opportunity vs. Rithm Property Trust | Retail Opportunity vs. Urban Edge Properties | Retail Opportunity 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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