Correlation Between Site Centers and Hoya Capital

Can any of the company-specific risk be diversified away by investing in both Site Centers and Hoya Capital 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 Hoya Capital 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 Hoya Capital High, you can compare the effects of market volatilities on Site Centers and Hoya Capital 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 Hoya Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Site Centers and Hoya Capital.

Diversification Opportunities for Site Centers and Hoya Capital

-0.41

Correlation Coefficient

Site Centers  Hoya Capital

Very good diversification

The 3 months correlation between Site and Hoya is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Site Centers Corp and Hoya Capital High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hoya Capital High 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 Hoya Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hoya Capital High has no effect on the direction of Site Centers i.e., Site Centers and Hoya Capital go up and down completely randomly.

Pair Corralation between Site Centers and Hoya Capital

Given the investment horizon of 90 days Site Centers Corp is expected to generate 7.55 times more return on investment than Hoya Capital. However, Site Centers is 7.55 times more volatile than Hoya Capital High. It trades about 0.1 of its potential returns per unit of risk. Hoya Capital High is currently generating about -0.04 per unit of risk. If you would invest  1,155  in Site Centers Corp on September 12, 2024 and sell it today you would earn a total of  384.00  from holding Site Centers Corp or generate 33.25% return on investment over 90 days.

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

Site Centers Corp  vs.  Hoya Capital High

Site Centers Corp

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Site Centers Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Site Centers exhibited solid returns over the last few months and may actually be approaching a breakup point.

Hoya Capital High

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hoya Capital High has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Hoya Capital is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Site Centers and Hoya Capital

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

The idea behind Site Centers Corp and Hoya Capital High 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.