Correlation Between Simon Property and Lewis Clark

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

Diversification Opportunities for Simon Property and Lewis Clark

-0.61

Correlation Coefficient

Simon Property  Lewis Clark

Excellent diversification

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

Pair Corralation between Simon Property and Lewis Clark

Considering the 90-day investment horizon Simon Property Group is expected to under-perform the Lewis Clark. In addition to that, Simon Property is 1.08 times more volatile than Lewis Clark Bancorp. It trades about 0.0 of its total potential returns per unit of risk. Lewis Clark Bancorp is currently generating about 0.09 per unit of volatility. If you would invest  3,005  in Lewis Clark Bancorp on December 27, 2024 and sell it today you would earn a total of  224.00  from holding Lewis Clark Bancorp or generate 7.45% return on investment over 90 days.

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

Simon Property Group  vs.  Lewis Clark Bancorp

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.

Lewis Clark Bancorp

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Lewis Clark Bancorp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting fundamental indicators, Lewis Clark may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Simon Property and Lewis Clark

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

The idea behind Simon Property Group and Lewis Clark Bancorp 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.

Check out your portfolio center.

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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.