Correlation Between Fidus Investment and Kite Realty
Can any of the company-specific risk be diversified away by investing in both Fidus Investment 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 Fidus Investment and Kite Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidus Investment Corp and Kite Realty Group, you can compare the effects of market volatilities on Fidus Investment 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 Fidus Investment with a short position of Kite Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidus Investment and Kite Realty.
Diversification Opportunities for Fidus Investment and Kite Realty
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Fidus and Kite is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Fidus Investment Corp 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 Fidus Investment 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 Fidus Investment Corp 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 Fidus Investment i.e., Fidus Investment and Kite Realty go up and down completely randomly.
Pair Corralation between Fidus Investment and Kite Realty
Given the investment horizon of 90 days Fidus Investment Corp is expected to generate 0.83 times more return on investment than Kite Realty. However, Fidus Investment Corp is 1.21 times less risky than Kite Realty. It trades about 0.53 of its potential returns per unit of risk. Kite Realty Group is currently generating about 0.32 per unit of risk. If you would invest 1,945 in Fidus Investment Corp on September 2, 2024 and sell it today you would earn a total of 184.00 from holding Fidus Investment Corp or generate 9.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidus Investment Corp vs. Kite Realty Group
Performance |
| Timeline |
| Fidus Investment Corp |
| Kite Realty Group |
Fidus Investment and Kite Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidus Investment and Kite Realty
The main advantage of trading using opposite Fidus Investment and Kite Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidus Investment 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.| Fidus Investment vs. Visa Class A | Fidus Investment vs. Diamond Hill Investment | Fidus Investment vs. Distoken Acquisition | Fidus Investment vs. Associated Capital Group |
| 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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