Correlation Between Brixmor Property and Kimco Realty

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

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

Diversification Opportunities for Brixmor Property and Kimco Realty

0.97

Correlation Coefficient

Brixmor Property  Kimco Realty

Almost no diversification

The 3 months correlation between Brixmor and Kimco is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Brixmor Property Group and Kimco Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kimco Realty and Brixmor 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 Brixmor Property Group are associated (or correlated) with Kimco Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kimco Realty has no effect on the direction of Brixmor Property i.e., Brixmor Property and Kimco Realty go up and down completely randomly.

Pair Corralation between Brixmor Property and Kimco Realty

Assuming the 90 days horizon Brixmor Property Group is expected to generate 0.97 times more return on investment than Kimco Realty. However, Brixmor Property Group is 1.03 times less risky than Kimco Realty. It trades about 0.21 of its potential returns per unit of risk. Kimco Realty is currently generating about 0.2 per unit of risk. If you would invest  2,413  in Brixmor Property Group on September 2, 2024 and sell it today you would earn a total of  407.00  from holding Brixmor Property Group or generate 16.87% return on investment over 90 days.

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

Brixmor Property Group  vs.  Kimco Realty

Brixmor Property

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Brixmor Property Group are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Brixmor Property reported solid returns over the last few months and may actually be approaching a breakup point.

Kimco Realty

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Kimco Realty are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Kimco Realty reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Brixmor Property and Kimco Realty

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

The idea behind Brixmor Property Group and Kimco Realty 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.