Correlation Between SITE Centers and Kimco Realty

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

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

Diversification Opportunities for SITE Centers and Kimco Realty

-0.4

Correlation Coefficient

SITE Centers  Kimco Realty

Very good diversification

The 3 months correlation between SITE and Kimco is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding SITE Centers Corp and Kimco Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kimco Realty and SITE Centers 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 SITE Centers Corp 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 SITE Centers i.e., SITE Centers and Kimco Realty go up and down completely randomly.

Pair Corralation between SITE Centers and Kimco Realty

Assuming the 90 days trading horizon SITE Centers Corp is expected to generate 0.97 times more return on investment than Kimco Realty. However, SITE Centers Corp is 1.03 times less risky than Kimco Realty. It trades about 0.18 of its potential returns per unit of risk. Kimco Realty is currently generating about -0.02 per unit of risk. If you would invest  2,308  in SITE Centers Corp on September 4, 2024 and sell it today you would earn a total of  208.00  from holding SITE Centers Corp or generate 9.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	93.75%
Values	Daily Returns

SITE Centers Corp  vs.  Kimco Realty

SITE Centers Corp

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SITE Centers Corp are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady basic indicators, SITE Centers may actually be approaching a critical reversion point that can send shares even higher in January 2025.

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. In spite of very healthy primary indicators, Kimco Realty is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with SITE Centers and Kimco Realty

The main advantage of trading using opposite SITE Centers and Kimco Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SITE Centers 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 SITE Centers Corp 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.