Correlation Between Link Real and Klpierre
Can any of the company-specific risk be diversified away by investing in both Link Real and Klpierre 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 Link Real and Klpierre into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Link Real Estate and Klpierre SA, you can compare the effects of market volatilities on Link Real and Klpierre 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 Link Real with a short position of Klpierre. Check out your portfolio center. Please also check ongoing floating volatility patterns of Link Real and Klpierre.
Diversification Opportunities for Link Real and Klpierre
Poor diversification
The 3 months correlation between Link and Klpierre is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Link Real Estate and Klpierre SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Klpierre SA and Link Real 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 Link Real Estate are associated (or correlated) with Klpierre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Klpierre SA has no effect on the direction of Link Real i.e., Link Real and Klpierre go up and down completely randomly.
Pair Corralation between Link Real and Klpierre
Assuming the 90 days horizon Link Real Estate is expected to generate 5.2 times more return on investment than Klpierre. However, Link Real is 5.2 times more volatile than Klpierre SA. It trades about 0.12 of its potential returns per unit of risk. Klpierre SA is currently generating about 0.06 per unit of risk. If you would invest 403.00 in Link Real Estate on October 25, 2024 and sell it today you would earn a total of 22.00 from holding Link Real Estate or generate 5.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Link Real Estate vs. Klpierre SA
Performance |
| Timeline |
| Link Real Estate |
| Klpierre SA |
Link Real and Klpierre Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Link Real and Klpierre
The main advantage of trading using opposite Link Real and Klpierre positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Link Real position performs unexpectedly, Klpierre 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 Klpierre will offset losses from the drop in Klpierre's long position.| Link Real vs. Kimco Realty | Link Real vs. Simon Property Group | Link Real vs. Saul Centers | Link Real vs. Kimco Realty |
| Klpierre vs. Cedar Realty Trust | Klpierre vs. Wheeler Real Estate | Klpierre vs. Macerich Company | Klpierre vs. Simon Property Group |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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