Correlation Between Rithm Property and Kimco Realty

Can any of the company-specific risk be diversified away by investing in both Rithm 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 Rithm 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 Rithm Property Trust and Kimco Realty, you can compare the effects of market volatilities on Rithm 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 Rithm Property with a short position of Kimco Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rithm Property and Kimco Realty.

Diversification Opportunities for Rithm Property and Kimco Realty

0.47

Correlation Coefficient

Rithm Property  Kimco Realty

Very weak diversification

The 3 months correlation between Rithm and Kimco is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Rithm Property Trust and Kimco Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kimco Realty and Rithm 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 Rithm Property Trust 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 Rithm Property i.e., Rithm Property and Kimco Realty go up and down completely randomly.

Pair Corralation between Rithm Property and Kimco Realty

Considering the 90-day investment horizon Rithm Property Trust is expected to under-perform the Kimco Realty. In addition to that, Rithm Property is 2.07 times more volatile than Kimco Realty. It trades about -0.15 of its total potential returns per unit of risk. Kimco Realty is currently generating about -0.08 per unit of volatility. If you would invest  2,300  in Kimco Realty on September 13, 2024 and sell it today you would lose (98.00) from holding Kimco Realty or give up 4.26% of portfolio value over 90 days.

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

Rithm Property Trust  vs.  Kimco Realty

Rithm Property Trust

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Rithm Property Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Kimco Realty

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kimco Realty has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent primary indicators, Kimco Realty is not utilizing all of its potentials. The new stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Rithm Property and Kimco Realty

The main advantage of trading using opposite Rithm Property and Kimco Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rithm 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 Rithm Property Trust 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.