Correlation Between Kite Realty and KINDER

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Can any of the company-specific risk be diversified away by investing in both Kite Realty and KINDER 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 Kite Realty and KINDER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kite Realty Group and KINDER MORGAN ENERGY, you can compare the effects of market volatilities on Kite Realty and KINDER 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 Kite Realty with a short position of KINDER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kite Realty and KINDER.

Diversification Opportunities for Kite Realty and KINDER

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  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Kite and KINDER is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Kite Realty Group and KINDER MORGAN ENERGY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KINDER MORGAN ENERGY and Kite Realty 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 Kite Realty Group are associated (or correlated) with KINDER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KINDER MORGAN ENERGY has no effect on the direction of Kite Realty i.e., Kite Realty and KINDER go up and down completely randomly.

Pair Corralation between Kite Realty and KINDER

If you would invest (100.00) in KINDER MORGAN ENERGY on October 7, 2024 and sell it today you would earn a total of  100.00  from holding KINDER MORGAN ENERGY or generate -100.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Kite Realty Group  vs.  KINDER MORGAN ENERGY

 Performance 
       Timeline  
Kite Realty Group 

Risk-Adjusted Performance

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Very Weak
Over the last 90 days Kite Realty Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Kite Realty is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.
KINDER MORGAN ENERGY 

Risk-Adjusted Performance

0 of 100

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

Kite Realty and KINDER Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Kite Realty and KINDER

The main advantage of trading using opposite Kite Realty and KINDER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kite Realty position performs unexpectedly, KINDER 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 KINDER will offset losses from the drop in KINDER's long position.
The idea behind Kite Realty Group and KINDER MORGAN ENERGY 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..

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