Correlation Between IONQ and SIMON

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

By analyzing existing cross correlation between IONQ Inc and SIMON PROPERTY GROUP, you can compare the effects of market volatilities on IONQ and SIMON 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 IONQ with a short position of SIMON. Check out your portfolio center. Please also check ongoing floating volatility patterns of IONQ and SIMON.

Diversification Opportunities for IONQ and SIMON

0.06

Correlation Coefficient

IONQ  SIMON

Significant diversification

The 3 months correlation between IONQ and SIMON is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding IONQ Inc 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 IONQ 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 IONQ Inc are associated (or correlated) with SIMON. 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 IONQ i.e., IONQ and SIMON go up and down completely randomly.

Pair Corralation between IONQ and SIMON

Given the investment horizon of 90 days IONQ Inc is expected to under-perform the SIMON. In addition to that, IONQ is 36.31 times more volatile than SIMON PROPERTY GROUP. It trades about -0.01 of its total potential returns per unit of risk. SIMON PROPERTY GROUP is currently generating about -0.03 per unit of volatility. If you would invest  9,211  in SIMON PROPERTY GROUP on December 4, 2024 and sell it today you would lose (54.00) from holding SIMON PROPERTY GROUP or give up 0.59% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.33%
Values	Daily Returns

IONQ Inc  vs.  SIMON PROPERTY GROUP

IONQ Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days IONQ Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, IONQ is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

SIMON PROPERTY GROUP

Risk-Adjusted Performance

Very Weak

Over the last 90 days SIMON PROPERTY GROUP has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, SIMON is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with IONQ and SIMON

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

The idea behind IONQ Inc and SIMON PROPERTY GROUP 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.