Correlation Between SL Green and Kilroy Realty
Can any of the company-specific risk be diversified away by investing in both SL Green and Kilroy 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 SL Green and Kilroy Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SL Green Realty and Kilroy Realty Corp, you can compare the effects of market volatilities on SL Green and Kilroy 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 SL Green with a short position of Kilroy Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of SL Green and Kilroy Realty.
Diversification Opportunities for SL Green and Kilroy Realty
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GEI and Kilroy is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding SL Green Realty and Kilroy Realty Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kilroy Realty Corp and SL Green 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 SL Green Realty are associated (or correlated) with Kilroy Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kilroy Realty Corp has no effect on the direction of SL Green i.e., SL Green and Kilroy Realty go up and down completely randomly.
Pair Corralation between SL Green and Kilroy Realty
Assuming the 90 days horizon SL Green Realty is expected to generate 0.96 times more return on investment than Kilroy Realty. However, SL Green Realty is 1.04 times less risky than Kilroy Realty. It trades about 0.15 of its potential returns per unit of risk. Kilroy Realty Corp is currently generating about 0.14 per unit of risk. If you would invest 6,895 in SL Green Realty on September 1, 2024 and sell it today you would earn a total of 437.00 from holding SL Green Realty or generate 6.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SL Green Realty vs. Kilroy Realty Corp
Performance |
| Timeline |
| SL Green Realty |
| Kilroy Realty Corp |
SL Green and Kilroy Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SL Green and Kilroy Realty
The main advantage of trading using opposite SL Green and Kilroy Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SL Green position performs unexpectedly, Kilroy 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 Kilroy Realty will offset losses from the drop in Kilroy Realty's long position.| SL Green vs. VIRGIN WINES UK | SL Green vs. Beijing Media | SL Green vs. NAKED WINES PLC | SL Green vs. PLAYSTUDIOS A DL 0001 |
| Kilroy Realty vs. TYSON FOODS A | Kilroy Realty vs. Entravision Communications | Kilroy Realty vs. CN MODERN DAIRY | Kilroy Realty vs. Ribbon Communications |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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