Correlation Between Kimco Realty and CapitaLand Integrated

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

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

Diversification Opportunities for Kimco Realty and CapitaLand Integrated

-0.82

Correlation Coefficient

Kimco Realty  CapitaLand Integrated

Pay attention - limited upside

The 3 months correlation between Kimco and CapitaLand is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Kimco Realty and CapitaLand Integrated Commerci in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CapitaLand Integrated and Kimco Realty 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 Kimco Realty are associated (or correlated) with CapitaLand Integrated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CapitaLand Integrated has no effect on the direction of Kimco Realty i.e., Kimco Realty and CapitaLand Integrated go up and down completely randomly.

Pair Corralation between Kimco Realty and CapitaLand Integrated

Considering the 90-day investment horizon Kimco Realty is expected to generate 0.28 times more return on investment than CapitaLand Integrated. However, Kimco Realty is 3.55 times less risky than CapitaLand Integrated. It trades about 0.07 of its potential returns per unit of risk. CapitaLand Integrated Commercial is currently generating about -0.04 per unit of risk. If you would invest  2,342  in Kimco Realty on September 12, 2024 and sell it today you would earn a total of  103.00  from holding Kimco Realty or generate 4.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	98.44%
Values	Daily Returns

Kimco Realty  vs.  CapitaLand Integrated Commerci

Kimco Realty

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Kimco Realty are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward indicators, Kimco Realty is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

CapitaLand Integrated

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CapitaLand Integrated Commercial has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's primary indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Kimco Realty and CapitaLand Integrated

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

The idea behind Kimco Realty and CapitaLand Integrated Commercial 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.