Correlation Between Simon Property and Proficient Auto

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

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

Diversification Opportunities for Simon Property and Proficient Auto

-0.78

Correlation Coefficient

Simon Property  Proficient Auto

Pay attention - limited upside

The 3 months correlation between Simon and Proficient is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Simon Property Group and Proficient Auto Logistics, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Proficient Auto Logi and Simon 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 Simon Property Group are associated (or correlated) with Proficient Auto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Proficient Auto Logi has no effect on the direction of Simon Property i.e., Simon Property and Proficient Auto go up and down completely randomly.

Pair Corralation between Simon Property and Proficient Auto

Considering the 90-day investment horizon Simon Property is expected to generate 3.64 times less return on investment than Proficient Auto. But when comparing it to its historical volatility, Simon Property Group is 3.59 times less risky than Proficient Auto. It trades about 0.24 of its potential returns per unit of risk. Proficient Auto Logistics, is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest  840.00  in Proficient Auto Logistics, on September 5, 2024 and sell it today you would earn a total of  152.00  from holding Proficient Auto Logistics, or generate 18.1% return on investment over 90 days.

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

Simon Property Group  vs.  Proficient Auto Logistics,

Simon Property Group

Risk-Adjusted Performance

14 of 100

Good

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

Proficient Auto Logi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Proficient Auto Logistics, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Simon Property and Proficient Auto

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

The idea behind Simon Property Group and Proficient Auto Logistics, 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.