Correlation Between Brixmor Property and Klépierre

Can any of the company-specific risk be diversified away by investing in both Brixmor Property and Klépierre 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 Brixmor Property and Klépierre into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Brixmor Property Group and Klpierre SA, you can compare the effects of market volatilities on Brixmor Property and Klépierre 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 Brixmor Property with a short position of Klépierre. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brixmor Property and Klépierre.

Diversification Opportunities for Brixmor Property and Klépierre

-0.41

Correlation Coefficient

Brixmor Property  Klépierre

Very good diversification

The 3 months correlation between Brixmor and Klépierre is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Brixmor Property Group and Klpierre SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Klpierre SA and Brixmor 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 Brixmor Property Group are associated (or correlated) with Klépierre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Klpierre SA has no effect on the direction of Brixmor Property i.e., Brixmor Property and Klépierre go up and down completely randomly.

Pair Corralation between Brixmor Property and Klépierre

Assuming the 90 days horizon Brixmor Property Group is expected to under-perform the Klépierre. In addition to that, Brixmor Property is 1.36 times more volatile than Klpierre SA. It trades about -0.1 of its total potential returns per unit of risk. Klpierre SA is currently generating about 0.2 per unit of volatility. If you would invest  2,698  in Klpierre SA on December 23, 2024 and sell it today you would earn a total of  344.00  from holding Klpierre SA or generate 12.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Brixmor Property Group  vs.  Klpierre SA

Brixmor Property

Risk-Adjusted Performance

Very Weak

Over the last 90 days Brixmor Property Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Klpierre SA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Klpierre SA are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Klépierre reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Brixmor Property and Klépierre

The main advantage of trading using opposite Brixmor Property and Klépierre positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brixmor Property position performs unexpectedly, Klépierre 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 Klépierre will offset losses from the drop in Klépierre's long position.

The idea behind Brixmor Property Group and Klpierre SA 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.

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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.