Correlation Between Kite Realty and Urban Edge
Can any of the company-specific risk be diversified away by investing in both Kite Realty and Urban Edge 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 Urban Edge 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 Urban Edge Properties, you can compare the effects of market volatilities on Kite Realty and Urban Edge 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 Urban Edge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kite Realty and Urban Edge.
Diversification Opportunities for Kite Realty and Urban Edge
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kite and Urban is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Kite Realty Group and Urban Edge Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Urban Edge Properties 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 Urban Edge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Urban Edge Properties has no effect on the direction of Kite Realty i.e., Kite Realty and Urban Edge go up and down completely randomly.
Pair Corralation between Kite Realty and Urban Edge
Considering the 90-day investment horizon Kite Realty is expected to generate 1.11 times less return on investment than Urban Edge. But when comparing it to its historical volatility, Kite Realty Group is 1.14 times less risky than Urban Edge. It trades about 0.18 of its potential returns per unit of risk. Urban Edge Properties is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 2,195 in Urban Edge Properties on August 24, 2024 and sell it today you would earn a total of 100.00 from holding Urban Edge Properties or generate 4.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kite Realty Group vs. Urban Edge Properties
Performance |
| Timeline |
| Kite Realty Group |
| Urban Edge Properties |
Kite Realty and Urban Edge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kite Realty and Urban Edge
The main advantage of trading using opposite Kite Realty and Urban Edge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kite Realty position performs unexpectedly, Urban Edge 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 Urban Edge will offset losses from the drop in Urban Edge's long position.| Kite Realty vs. Site Centers Corp | Kite Realty vs. CBL Associates Properties | Kite Realty vs. Urban Edge Properties | Kite Realty vs. Acadia Realty Trust |
| Urban Edge vs. Site Centers Corp | Urban Edge vs. Kite Realty Group | Urban Edge vs. Retail Opportunity Investments | Urban Edge vs. Inventrust Properties Corp |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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