Correlation Between CT Real and Simon Property
Can any of the company-specific risk be diversified away by investing in both CT Real and Simon Property 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 CT Real and Simon Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CT Real Estate and Simon Property Group, you can compare the effects of market volatilities on CT Real and Simon Property 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 CT Real with a short position of Simon Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of CT Real and Simon Property.
Diversification Opportunities for CT Real and Simon Property
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CTRRF and Simon is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding CT Real Estate and Simon Property Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simon Property Group and CT Real 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 CT Real Estate are associated (or correlated) with Simon Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simon Property Group has no effect on the direction of CT Real i.e., CT Real and Simon Property go up and down completely randomly.
Pair Corralation between CT Real and Simon Property
Assuming the 90 days horizon CT Real Estate is expected to under-perform the Simon Property. In addition to that, CT Real is 7.36 times more volatile than Simon Property Group. It trades about -0.07 of its total potential returns per unit of risk. Simon Property Group is currently generating about -0.07 per unit of volatility. If you would invest 6,250 in Simon Property Group on August 25, 2024 and sell it today you would lose (70.00) from holding Simon Property Group or give up 1.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CT Real Estate vs. Simon Property Group
Performance |
| Timeline |
| CT Real Estate |
| Simon Property Group |
CT Real and Simon Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CT Real and Simon Property
The main advantage of trading using opposite CT Real and Simon Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CT Real position performs unexpectedly, Simon Property 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 Simon Property will offset losses from the drop in Simon Property's long position.| CT Real vs. Smart REIT | CT Real vs. Phillips Edison Co | CT Real vs. Simon Property Group | CT Real vs. Plaza Retail REIT |
| Simon Property vs. Kimco Realty | Simon Property vs. Saul Centers | Simon Property vs. Saul Centers | Simon Property vs. Urban Edge Properties |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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