Correlation Between Simon Property and JBG SMITH
Can any of the company-specific risk be diversified away by investing in both Simon Property and JBG SMITH 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 JBG SMITH 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 JBG SMITH Properties, you can compare the effects of market volatilities on Simon Property and JBG SMITH 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 JBG SMITH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simon Property and JBG SMITH.
Diversification Opportunities for Simon Property and JBG SMITH
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Simon and JBG is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Simon Property Group and JBG SMITH Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JBG SMITH Properties 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 JBG SMITH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JBG SMITH Properties has no effect on the direction of Simon Property i.e., Simon Property and JBG SMITH go up and down completely randomly.
Pair Corralation between Simon Property and JBG SMITH
Considering the 90-day investment horizon Simon Property Group is expected to generate 0.68 times more return on investment than JBG SMITH. However, Simon Property Group is 1.46 times less risky than JBG SMITH. It trades about 0.08 of its potential returns per unit of risk. JBG SMITH Properties is currently generating about 0.0 per unit of risk. If you would invest 10,554 in Simon Property Group on August 30, 2024 and sell it today you would earn a total of 7,821 from holding Simon Property Group or generate 74.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Simon Property Group vs. JBG SMITH Properties
Performance |
| Timeline |
| Simon Property Group |
| JBG SMITH Properties |
Simon Property and JBG SMITH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simon Property and JBG SMITH
The main advantage of trading using opposite Simon Property and JBG SMITH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simon Property position performs unexpectedly, JBG SMITH 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 JBG SMITH will offset losses from the drop in JBG SMITH'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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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