Correlation Between Simon Property and Uber Technologies
Can any of the company-specific risk be diversified away by investing in both Simon Property and Uber Technologies 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 Uber Technologies 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 Uber Technologies, you can compare the effects of market volatilities on Simon Property and Uber Technologies 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 Uber Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simon Property and Uber Technologies.
Diversification Opportunities for Simon Property and Uber Technologies
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Simon and Uber is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Simon Property Group and Uber Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uber Technologies 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 Uber Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uber Technologies has no effect on the direction of Simon Property i.e., Simon Property and Uber Technologies go up and down completely randomly.
Pair Corralation between Simon Property and Uber Technologies
Considering the 90-day investment horizon Simon Property is expected to generate 1.1 times less return on investment than Uber Technologies. But when comparing it to its historical volatility, Simon Property Group is 1.71 times less risky than Uber Technologies. It trades about 0.12 of its potential returns per unit of risk. Uber Technologies is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 4,026 in Uber Technologies on August 31, 2024 and sell it today you would earn a total of 3,170 from holding Uber Technologies or generate 78.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Simon Property Group vs. Uber Technologies
Performance |
| Timeline |
| Simon Property Group |
| Uber Technologies |
Simon Property and Uber Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simon Property and Uber Technologies
The main advantage of trading using opposite Simon Property and Uber Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simon Property position performs unexpectedly, Uber Technologies 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 Uber Technologies will offset losses from the drop in Uber Technologies' long position.| Simon Property vs. Federal Realty Investment | Simon Property vs. Agree Realty | Simon Property vs. National Retail Properties | Simon Property vs. Kimco Realty |
| Uber Technologies vs. Zoom Video Communications | Uber Technologies vs. Snowflake | Uber Technologies vs. Workday | Uber Technologies vs. C3 Ai Inc |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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