Correlation Between Kite Realty and Electronic Arts
Can any of the company-specific risk be diversified away by investing in both Kite Realty and Electronic Arts 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 Kite Realty and Electronic Arts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kite Realty Group and Electronic Arts, you can compare the effects of market volatilities on Kite Realty and Electronic Arts 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 Kite Realty with a short position of Electronic Arts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kite Realty and Electronic Arts.
Diversification Opportunities for Kite Realty and Electronic Arts
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kite and Electronic is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Kite Realty Group and Electronic Arts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electronic Arts and Kite 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 Kite Realty Group are associated (or correlated) with Electronic Arts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electronic Arts has no effect on the direction of Kite Realty i.e., Kite Realty and Electronic Arts go up and down completely randomly.
Pair Corralation between Kite Realty and Electronic Arts
Considering the 90-day investment horizon Kite Realty is expected to generate 2.74 times less return on investment than Electronic Arts. But when comparing it to its historical volatility, Kite Realty Group is 1.01 times less risky than Electronic Arts. It trades about 0.21 of its potential returns per unit of risk. Electronic Arts is currently generating about 0.57 of returns per unit of risk over similar time horizon. If you would invest 14,503 in Electronic Arts on August 25, 2024 and sell it today you would earn a total of 2,164 from holding Electronic Arts or generate 14.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kite Realty Group vs. Electronic Arts
Performance |
| Timeline |
| Kite Realty Group |
| Electronic Arts |
Kite Realty and Electronic Arts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kite Realty and Electronic Arts
The main advantage of trading using opposite Kite Realty and Electronic Arts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kite Realty position performs unexpectedly, Electronic Arts 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 Electronic Arts will offset losses from the drop in Electronic Arts' long position.| Kite Realty vs. Urban Edge Properties | Kite Realty vs. Site Centers Corp | Kite Realty vs. Inventrust Properties Corp | Kite Realty vs. Retail Opportunity Investments |
| Electronic Arts vs. Playstudios | Electronic Arts vs. Talkspace | Electronic Arts vs. Katapult Holdings Equity | Electronic Arts vs. Aquagold International |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Global Correlations Find global opportunities by holding instruments from different markets |