Correlation Between MYT Netherlands and Kite Realty

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

By analyzing existing cross correlation between MYT Netherlands Parent and Kite Realty Group, you can compare the effects of market volatilities on MYT Netherlands and Kite Realty 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 MYT Netherlands with a short position of Kite Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of MYT Netherlands and Kite Realty.

Diversification Opportunities for MYT Netherlands and Kite Realty

-0.18

Correlation Coefficient

MYT Netherlands  Kite Realty

Good diversification

The 3 months correlation between MYT and Kite is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding MYT Netherlands Parent and Kite Realty Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kite Realty Group and MYT Netherlands 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 MYT Netherlands Parent are associated (or correlated) with Kite Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kite Realty Group has no effect on the direction of MYT Netherlands i.e., MYT Netherlands and Kite Realty go up and down completely randomly.

Pair Corralation between MYT Netherlands and Kite Realty

Given the investment horizon of 90 days MYT Netherlands Parent is expected to generate 4.63 times more return on investment than Kite Realty. However, MYT Netherlands is 4.63 times more volatile than Kite Realty Group. It trades about 0.1 of its potential returns per unit of risk. Kite Realty Group is currently generating about 0.07 per unit of risk. If you would invest  273.00  in MYT Netherlands Parent on October 7, 2024 and sell it today you would earn a total of  451.00  from holding MYT Netherlands Parent or generate 165.2% return on investment over 90 days.

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

MYT Netherlands Parent  vs.  Kite Realty Group

MYT Netherlands Parent

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in MYT Netherlands Parent are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, MYT Netherlands may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Kite Realty Group

Risk-Adjusted Performance

0 of 100

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.

Pair Trading with MYT Netherlands and Kite Realty

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

The idea behind MYT Netherlands Parent and Kite Realty 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.