Correlation Between Simon Property and 91324PEN8

Can any of the company-specific risk be diversified away by investing in both Simon Property and 91324PEN8 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 91324PEN8 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 UNH 515 15 OCT 25, you can compare the effects of market volatilities on Simon Property and 91324PEN8 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 91324PEN8. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simon Property and 91324PEN8.

Diversification Opportunities for Simon Property and 91324PEN8

-0.57

Correlation Coefficient

Simon Property  91324PEN8

Excellent diversification

The 3 months correlation between Simon and 91324PEN8 is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Simon Property Group and UNH 515 15 OCT 25 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNH 515 15 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 91324PEN8. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNH 515 15 has no effect on the direction of Simon Property i.e., Simon Property and 91324PEN8 go up and down completely randomly.

Pair Corralation between Simon Property and 91324PEN8

Considering the 90-day investment horizon Simon Property Group is expected to under-perform the 91324PEN8. In addition to that, Simon Property is 8.68 times more volatile than UNH 515 15 OCT 25. It trades about -0.14 of its total potential returns per unit of risk. UNH 515 15 OCT 25 is currently generating about 0.04 per unit of volatility. If you would invest  10,044  in UNH 515 15 OCT 25 on September 20, 2024 and sell it today you would earn a total of  12.00  from holding UNH 515 15 OCT 25 or generate 0.12% return on investment over 90 days.

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

Simon Property Group  vs.  UNH 515 15 OCT 25

Simon Property Group

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Simon Property Group are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, Simon Property may actually be approaching a critical reversion point that can send shares even higher in January 2025.

UNH 515 15

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days UNH 515 15 OCT 25 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 91324PEN8 is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Simon Property and 91324PEN8

The main advantage of trading using opposite Simon Property and 91324PEN8 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simon Property position performs unexpectedly, 91324PEN8 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 91324PEN8 will offset losses from the drop in 91324PEN8's long position.

The idea behind Simon Property Group and UNH 515 15 OCT 25 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.