Correlation Between SAFETY MEDICAL and Simon Property
Can any of the company-specific risk be diversified away by investing in both SAFETY MEDICAL 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 SAFETY MEDICAL and Simon Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SAFETY MEDICAL PROD and Simon Property Group, you can compare the effects of market volatilities on SAFETY MEDICAL 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 SAFETY MEDICAL with a short position of Simon Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of SAFETY MEDICAL and Simon Property.
Diversification Opportunities for SAFETY MEDICAL and Simon Property
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SAFETY and Simon is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding SAFETY MEDICAL PROD 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 SAFETY MEDICAL 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 SAFETY MEDICAL PROD 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 SAFETY MEDICAL i.e., SAFETY MEDICAL and Simon Property go up and down completely randomly.
Pair Corralation between SAFETY MEDICAL and Simon Property
Assuming the 90 days trading horizon SAFETY MEDICAL PROD is expected to under-perform the Simon Property. In addition to that, SAFETY MEDICAL is 2.56 times more volatile than Simon Property Group. It trades about -0.28 of its total potential returns per unit of risk. Simon Property Group is currently generating about 0.18 per unit of volatility. If you would invest 16,540 in Simon Property Group on September 12, 2024 and sell it today you would earn a total of 550.00 from holding Simon Property Group or generate 3.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SAFETY MEDICAL PROD vs. Simon Property Group
Performance |
| Timeline |
| SAFETY MEDICAL PROD |
| Simon Property Group |
SAFETY MEDICAL and Simon Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SAFETY MEDICAL and Simon Property
The main advantage of trading using opposite SAFETY MEDICAL and Simon Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SAFETY MEDICAL 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.| SAFETY MEDICAL vs. Apple Inc | SAFETY MEDICAL vs. Apple Inc | SAFETY MEDICAL vs. Apple Inc | SAFETY MEDICAL vs. Apple Inc |
| Simon Property vs. Air Transport Services | Simon Property vs. BROADSTNET LEADL 00025 | Simon Property vs. International Game Technology | Simon Property vs. Gaztransport Technigaz SA |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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