Correlation Between Simon Property and Union Electric
Can any of the company-specific risk be diversified away by investing in both Simon Property and Union Electric 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 Simon Property and Union Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Simon Property Group and Union Electric, you can compare the effects of market volatilities on Simon Property and Union Electric 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 Simon Property with a short position of Union Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simon Property and Union Electric.
Diversification Opportunities for Simon Property and Union Electric
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Simon and Union is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Simon Property Group and Union Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Union Electric and Simon Property 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 Simon Property Group are associated (or correlated) with Union Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Union Electric has no effect on the direction of Simon Property i.e., Simon Property and Union Electric go up and down completely randomly.
Pair Corralation between Simon Property and Union Electric
Assuming the 90 days trading horizon Simon Property Group is expected to under-perform the Union Electric. But the preferred stock apears to be less risky and, when comparing its historical volatility, Simon Property Group is 2.45 times less risky than Union Electric. The preferred stock trades about -0.01 of its potential returns per unit of risk. The Union Electric is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 8,665 in Union Electric on November 3, 2024 and sell it today you would earn a total of 906.00 from holding Union Electric or generate 10.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Simon Property Group vs. Union Electric
Performance |
| Timeline |
| Simon Property Group |
| Union Electric |
Simon Property and Union Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simon Property and Union Electric
The main advantage of trading using opposite Simon Property and Union Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simon Property position performs unexpectedly, Union Electric 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 Union Electric will offset losses from the drop in Union Electric's long position.| Simon Property vs. Kimco Realty | Simon Property vs. Saul Centers | Simon Property vs. Saul Centers | Simon Property vs. Urban Edge Properties |
| Union Electric vs. BK Technologies | Union Electric vs. Zhihu Inc ADR | Union Electric vs. Cheche Group Class | Union Electric vs. Olympic Steel |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |