Correlation Between Simon Property and Mega Matrix

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

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

Diversification Opportunities for Simon Property and Mega Matrix

0.61

Correlation Coefficient

Simon Property  Mega Matrix

Poor diversification

The 3 months correlation between Simon and Mega is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Simon Property Group and Mega Matrix Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mega Matrix Corp and Simon 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 Simon Property Group are associated (or correlated) with Mega Matrix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mega Matrix Corp has no effect on the direction of Simon Property i.e., Simon Property and Mega Matrix go up and down completely randomly.

Pair Corralation between Simon Property and Mega Matrix

Assuming the 90 days trading horizon Simon Property is expected to generate 3.44 times less return on investment than Mega Matrix. But when comparing it to its historical volatility, Simon Property Group is 5.03 times less risky than Mega Matrix. It trades about 0.03 of its potential returns per unit of risk. Mega Matrix Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  170.00  in Mega Matrix Corp on October 25, 2024 and sell it today you would lose (49.00) from holding Mega Matrix Corp or give up 28.82% of portfolio value over 90 days.

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

Simon Property Group  vs.  Mega Matrix Corp

Simon Property Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Simon Property Group has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively steady technical and fundamental indicators, Simon Property is not utilizing all of its potentials. The current stock price chaos, may contribute to medium-term losses for the stakeholders.

Mega Matrix Corp

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Mega Matrix Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, Mega Matrix may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Simon Property and Mega Matrix

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

The idea behind Simon Property Group and Mega Matrix Corp 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 CEOs Directory module to screen CEOs from public companies around the world.