Correlation Between 126650DF4 and Kite Realty

Can any of the company-specific risk be diversified away by investing in both 126650DF4 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 126650DF4 and Kite Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CVS HEALTH P and Kite Realty Group, you can compare the effects of market volatilities on 126650DF4 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 126650DF4 with a short position of Kite Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of 126650DF4 and Kite Realty.

Diversification Opportunities for 126650DF4 and Kite Realty

-0.34

Correlation Coefficient

126650DF4  Kite Realty

Very good diversification

The 3 months correlation between 126650DF4 and Kite is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding CVS HEALTH P 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 126650DF4 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 CVS HEALTH P 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 126650DF4 i.e., 126650DF4 and Kite Realty go up and down completely randomly.

Pair Corralation between 126650DF4 and Kite Realty

Assuming the 90 days trading horizon CVS HEALTH P is expected to under-perform the Kite Realty. But the bond apears to be less risky and, when comparing its historical volatility, CVS HEALTH P is 3.33 times less risky than Kite Realty. The bond trades about -0.05 of its potential returns per unit of risk. The Kite Realty Group is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  2,149  in Kite Realty Group on September 12, 2024 and sell it today you would earn a total of  502.00  from holding Kite Realty Group or generate 23.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	97.6%
Values	Daily Returns

CVS HEALTH P  vs.  Kite Realty Group

CVS HEALTH P

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CVS HEALTH P has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 126650DF4 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Kite Realty Group

Risk-Adjusted Performance

1 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Kite Realty Group are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. 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 126650DF4 and Kite Realty

The main advantage of trading using opposite 126650DF4 and Kite Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 126650DF4 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 CVS HEALTH P 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.