Correlation Between Kimco Realty and Simon Property
Can any of the company-specific risk be diversified away by investing in both Kimco Realty 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 Kimco Realty and Simon Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kimco Realty and Simon Property Group, you can compare the effects of market volatilities on Kimco Realty 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 Kimco Realty with a short position of Simon Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kimco Realty and Simon Property.
Diversification Opportunities for Kimco Realty and Simon Property
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kimco and Simon is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Kimco Realty 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 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 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 Kimco Realty i.e., Kimco Realty and Simon Property go up and down completely randomly.
Pair Corralation between Kimco Realty and Simon Property
Considering the 90-day investment horizon Kimco Realty is expected to generate 0.91 times more return on investment than Simon Property. However, Kimco Realty is 1.1 times less risky than Simon Property. It trades about 0.35 of its potential returns per unit of risk. Simon Property Group is currently generating about 0.26 per unit of risk. If you would invest 2,355 in Kimco Realty on August 26, 2024 and sell it today you would earn a total of 182.00 from holding Kimco Realty or generate 7.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kimco Realty vs. Simon Property Group
Performance |
| Timeline |
| Kimco Realty |
| Simon Property Group |
Kimco Realty and Simon Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kimco Realty and Simon Property
The main advantage of trading using opposite Kimco Realty and Simon Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kimco Realty 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.The idea behind Kimco Realty and Simon Property Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Commodity Directory Find actively traded commodities issued by global exchanges |