Correlation Between Kilroy Realty and Boston Properties
Can any of the company-specific risk be diversified away by investing in both Kilroy Realty and Boston Properties 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 Kilroy Realty and Boston Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kilroy Realty Corp and Boston Properties, you can compare the effects of market volatilities on Kilroy Realty and Boston Properties 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 Kilroy Realty with a short position of Boston Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kilroy Realty and Boston Properties.
Diversification Opportunities for Kilroy Realty and Boston Properties
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Kilroy and Boston is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Kilroy Realty Corp and Boston Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boston Properties and Kilroy 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 Kilroy Realty Corp are associated (or correlated) with Boston Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boston Properties has no effect on the direction of Kilroy Realty i.e., Kilroy Realty and Boston Properties go up and down completely randomly.
Pair Corralation between Kilroy Realty and Boston Properties
Considering the 90-day investment horizon Kilroy Realty Corp is expected to generate 0.96 times more return on investment than Boston Properties. However, Kilroy Realty Corp is 1.04 times less risky than Boston Properties. It trades about -0.12 of its potential returns per unit of risk. Boston Properties is currently generating about -0.2 per unit of risk. If you would invest 4,146 in Kilroy Realty Corp on August 24, 2024 and sell it today you would lose (172.00) from holding Kilroy Realty Corp or give up 4.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kilroy Realty Corp vs. Boston Properties
Performance |
| Timeline |
| Kilroy Realty Corp |
| Boston Properties |
Kilroy Realty and Boston Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kilroy Realty and Boston Properties
The main advantage of trading using opposite Kilroy Realty and Boston Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kilroy Realty position performs unexpectedly, Boston Properties 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 Boston Properties will offset losses from the drop in Boston Properties' long position.| Kilroy Realty vs. Douglas Emmett | Kilroy Realty vs. Piedmont Office Realty | Kilroy Realty vs. City Office | Kilroy Realty vs. Cousins Properties Incorporated |
| Boston Properties vs. SL Green Realty | Boston Properties vs. Douglas Emmett | Boston Properties vs. Kilroy Realty Corp | Boston Properties vs. Alexandria Real Estate |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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