Correlation Between United Homes and Kimco Realty
Can any of the company-specific risk be diversified away by investing in both United Homes and Kimco Realty 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 United Homes and Kimco Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Homes Group and Kimco Realty, you can compare the effects of market volatilities on United Homes and Kimco Realty 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 United Homes with a short position of Kimco Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Homes and Kimco Realty.
Diversification Opportunities for United Homes and Kimco Realty
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between United and Kimco is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding United Homes Group and Kimco Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kimco Realty and United Homes 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 United Homes Group are associated (or correlated) with Kimco Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kimco Realty has no effect on the direction of United Homes i.e., United Homes and Kimco Realty go up and down completely randomly.
Pair Corralation between United Homes and Kimco Realty
Considering the 90-day investment horizon United Homes Group is expected to generate 5.39 times more return on investment than Kimco Realty. However, United Homes is 5.39 times more volatile than Kimco Realty. It trades about 0.05 of its potential returns per unit of risk. Kimco Realty is currently generating about -0.06 per unit of risk. If you would invest 432.00 in United Homes Group on October 25, 2024 and sell it today you would earn a total of 10.00 from holding United Homes Group or generate 2.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Homes Group vs. Kimco Realty
Performance |
| Timeline |
| United Homes Group |
| Kimco Realty |
United Homes and Kimco Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Homes and Kimco Realty
The main advantage of trading using opposite United Homes and Kimco Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Homes position performs unexpectedly, Kimco Realty 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 Kimco Realty will offset losses from the drop in Kimco Realty's long position.| United Homes vs. Coffee Holding Co | United Homes vs. One Group Hospitality | United Homes vs. Biglari Holdings | United Homes vs. Ryman Hospitality Properties |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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