Correlation Between Simon Property and Ameren Illinois
Can any of the company-specific risk be diversified away by investing in both Simon Property and Ameren Illinois 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 Ameren Illinois 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 Ameren Illinois, you can compare the effects of market volatilities on Simon Property and Ameren Illinois 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 Ameren Illinois. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simon Property and Ameren Illinois.
Diversification Opportunities for Simon Property and Ameren Illinois
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Simon and Ameren is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Simon Property Group and Ameren Illinois in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameren Illinois 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 Ameren Illinois. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameren Illinois has no effect on the direction of Simon Property i.e., Simon Property and Ameren Illinois go up and down completely randomly.
Pair Corralation between Simon Property and Ameren Illinois
Considering the 90-day investment horizon Simon Property Group is expected to generate 0.87 times more return on investment than Ameren Illinois. However, Simon Property Group is 1.15 times less risky than Ameren Illinois. It trades about 0.09 of its potential returns per unit of risk. Ameren Illinois is currently generating about 0.04 per unit of risk. If you would invest 13,808 in Simon Property Group on September 14, 2024 and sell it today you would earn a total of 4,050 from holding Simon Property Group or generate 29.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 86.35% |
| Values | Daily Returns |
Simon Property Group vs. Ameren Illinois
Performance |
| Timeline |
| Simon Property Group |
| Ameren Illinois |
Simon Property and Ameren Illinois Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simon Property and Ameren Illinois
The main advantage of trading using opposite Simon Property and Ameren Illinois positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simon Property position performs unexpectedly, Ameren Illinois 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 Ameren Illinois will offset losses from the drop in Ameren Illinois' long position.| Simon Property vs. Site Centers Corp | Simon Property vs. CBL Associates Properties | Simon Property vs. Urban Edge Properties | Simon Property vs. Acadia Realty Trust |
| Ameren Illinois vs. Entravision Communications | Ameren Illinois vs. BOS Better Online | Ameren Illinois vs. Awilco Drilling PLC | Ameren Illinois vs. WiMi Hologram Cloud |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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