Correlation Between Simon Property and Alexanders

Can any of the company-specific risk be diversified away by investing in both Simon Property and Alexanders 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 Alexanders 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 Alexanders, you can compare the effects of market volatilities on Simon Property and Alexanders 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 Alexanders. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simon Property and Alexanders.

Diversification Opportunities for Simon Property and Alexanders

-0.08

Correlation Coefficient

Simon Property  Alexanders

Good diversification

The 3 months correlation between Simon and Alexanders is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Simon Property Group and Alexanders in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alexanders 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 Alexanders. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alexanders has no effect on the direction of Simon Property i.e., Simon Property and Alexanders go up and down completely randomly.

Pair Corralation between Simon Property and Alexanders

Considering the 90-day investment horizon Simon Property Group is expected to under-perform the Alexanders. But the stock apears to be less risky and, when comparing its historical volatility, Simon Property Group is 1.03 times less risky than Alexanders. The stock trades about -0.01 of its potential returns per unit of risk. The Alexanders is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  19,557  in Alexanders on December 28, 2024 and sell it today you would earn a total of  1,683  from holding Alexanders or generate 8.61% return on investment over 90 days.

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

Simon Property Group  vs.  Alexanders

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 nearly stable basic indicators, Simon Property is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Alexanders

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Alexanders are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain essential indicators, Alexanders may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Simon Property and Alexanders

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

The idea behind Simon Property Group and Alexanders 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.