Correlation Between SIMON and 00108WAF7
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By analyzing existing cross correlation between SIMON PROPERTY GROUP and AEP TEX INC, you can compare the effects of market volatilities on SIMON and 00108WAF7 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 with a short position of 00108WAF7. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIMON and 00108WAF7.
Diversification Opportunities for SIMON and 00108WAF7
Significant diversification
The 3 months correlation between SIMON and 00108WAF7 is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding SIMON PROPERTY GROUP and AEP TEX INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEP TEX INC and SIMON 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 00108WAF7. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEP TEX INC has no effect on the direction of SIMON i.e., SIMON and 00108WAF7 go up and down completely randomly.
Pair Corralation between SIMON and 00108WAF7
Assuming the 90 days trading horizon SIMON PROPERTY GROUP is expected to under-perform the 00108WAF7. But the bond apears to be less risky and, when comparing its historical volatility, SIMON PROPERTY GROUP is 2.03 times less risky than 00108WAF7. The bond trades about -0.22 of its potential returns per unit of risk. The AEP TEX INC is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 7,420 in AEP TEX INC on August 29, 2024 and sell it today you would earn a total of 801.00 from holding AEP TEX INC or generate 10.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 71.43% |
| Values | Daily Returns |
SIMON PROPERTY GROUP vs. AEP TEX INC
Performance |
| Timeline |
| SIMON PROPERTY GROUP |
| AEP TEX INC |
SIMON and 00108WAF7 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIMON and 00108WAF7
The main advantage of trading using opposite SIMON and 00108WAF7 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIMON position performs unexpectedly, 00108WAF7 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 00108WAF7 will offset losses from the drop in 00108WAF7's long position.The idea behind SIMON PROPERTY GROUP and AEP TEX INC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| 00108WAF7 vs. Bluerock Homes Trust | 00108WAF7 vs. PennantPark Floating Rate | 00108WAF7 vs. EastGroup Properties | 00108WAF7 vs. NETGEAR |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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