Correlation Between Simon Property and Amexdrug
Can any of the company-specific risk be diversified away by investing in both Simon Property and Amexdrug 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 Amexdrug 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 Amexdrug, you can compare the effects of market volatilities on Simon Property and Amexdrug 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 Amexdrug. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simon Property and Amexdrug.
Diversification Opportunities for Simon Property and Amexdrug
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Simon and Amexdrug is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Simon Property Group and Amexdrug in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amexdrug 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 Amexdrug. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amexdrug has no effect on the direction of Simon Property i.e., Simon Property and Amexdrug go up and down completely randomly.
Pair Corralation between Simon Property and Amexdrug
Considering the 90-day investment horizon Simon Property is expected to generate 11.68 times less return on investment than Amexdrug. But when comparing it to its historical volatility, Simon Property Group is 27.06 times less risky than Amexdrug. It trades about 0.12 of its potential returns per unit of risk. Amexdrug is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 0.03 in Amexdrug on August 30, 2024 and sell it today you would earn a total of 0.17 from holding Amexdrug or generate 566.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Simon Property Group vs. Amexdrug
Performance |
| Timeline |
| Simon Property Group |
| Amexdrug |
Simon Property and Amexdrug Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simon Property and Amexdrug
The main advantage of trading using opposite Simon Property and Amexdrug positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simon Property position performs unexpectedly, Amexdrug 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 Amexdrug will offset losses from the drop in Amexdrug's long position.| Simon Property vs. Federal Realty Investment | Simon Property vs. Agree Realty | Simon Property vs. National Retail Properties | Simon Property vs. Kimco Realty |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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