Correlation Between Whitestone REIT and Simon Property
Can any of the company-specific risk be diversified away by investing in both Whitestone REIT and Simon Property 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 Whitestone REIT and Simon Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Whitestone REIT and Simon Property Group, you can compare the effects of market volatilities on Whitestone REIT and Simon Property 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 Whitestone REIT with a short position of Simon Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Whitestone REIT and Simon Property.
Diversification Opportunities for Whitestone REIT and Simon Property
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Whitestone and Simon is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Whitestone REIT and Simon Property Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simon Property Group and Whitestone REIT 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 Whitestone REIT are associated (or correlated) with Simon Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simon Property Group has no effect on the direction of Whitestone REIT i.e., Whitestone REIT and Simon Property go up and down completely randomly.
Pair Corralation between Whitestone REIT and Simon Property
Considering the 90-day investment horizon Whitestone REIT is expected to generate 1.04 times less return on investment than Simon Property. In addition to that, Whitestone REIT is 1.06 times more volatile than Simon Property Group. It trades about 0.07 of its total potential returns per unit of risk. Simon Property Group is currently generating about 0.08 per unit of volatility. If you would invest 10,478 in Simon Property Group on August 26, 2024 and sell it today you would earn a total of 7,636 from holding Simon Property Group or generate 72.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Whitestone REIT vs. Simon Property Group
Performance |
| Timeline |
| Whitestone REIT |
| Simon Property Group |
Whitestone REIT and Simon Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Whitestone REIT and Simon Property
The main advantage of trading using opposite Whitestone REIT and Simon Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Whitestone REIT position performs unexpectedly, Simon Property 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 Simon Property will offset losses from the drop in Simon Property's long position.| Whitestone REIT vs. Site Centers Corp | Whitestone REIT vs. Inventrust Properties Corp | Whitestone REIT vs. Retail Opportunity Investments | Whitestone REIT vs. Netstreit Corp |
| Simon Property vs. Site Centers Corp | Simon Property vs. Inventrust Properties Corp | Simon Property vs. Retail Opportunity Investments | Simon Property vs. Netstreit Corp |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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