Correlation Between Kimco Realty and Realty Income
Can any of the company-specific risk be diversified away by investing in both Kimco Realty and Realty Income 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 Kimco Realty and Realty Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kimco Realty and Realty Income, you can compare the effects of market volatilities on Kimco Realty and Realty Income 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 Kimco Realty with a short position of Realty Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kimco Realty and Realty Income.
Diversification Opportunities for Kimco Realty and Realty Income
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Kimco and Realty is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Kimco Realty and Realty Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Realty Income and Kimco Realty 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 Kimco Realty are associated (or correlated) with Realty Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Realty Income has no effect on the direction of Kimco Realty i.e., Kimco Realty and Realty Income go up and down completely randomly.
Pair Corralation between Kimco Realty and Realty Income
Assuming the 90 days trading horizon Kimco Realty is expected to generate 0.65 times more return on investment than Realty Income. However, Kimco Realty is 1.54 times less risky than Realty Income. It trades about -0.14 of its potential returns per unit of risk. Realty Income is currently generating about -0.35 per unit of risk. If you would invest 2,271 in Kimco Realty on August 24, 2024 and sell it today you would lose (60.00) from holding Kimco Realty or give up 2.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kimco Realty vs. Realty Income
Performance |
| Timeline |
| Kimco Realty |
| Realty Income |
Kimco Realty and Realty Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kimco Realty and Realty Income
The main advantage of trading using opposite Kimco Realty and Realty Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kimco Realty position performs unexpectedly, Realty Income 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 Realty Income will offset losses from the drop in Realty Income's long position.| Kimco Realty vs. Saul Centers | Kimco Realty vs. Wheeler Real Estate | Kimco Realty vs. Macerich Company | Kimco Realty vs. Simon Property Group |
| Realty Income vs. Federal Realty Investment | Realty Income vs. Agree Realty | Realty Income vs. National Retail Properties | Realty Income vs. Tanger Factory Outlet |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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