Correlation Between Anheuser Busch and SIMON

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

By analyzing existing cross correlation between Anheuser Busch Inbev and SIMON PPTY GROUP, you can compare the effects of market volatilities on Anheuser Busch and SIMON 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 Anheuser Busch with a short position of SIMON. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anheuser Busch and SIMON.

Diversification Opportunities for Anheuser Busch and SIMON

-0.66

Correlation Coefficient

Anheuser Busch  SIMON

Excellent diversification

The 3 months correlation between Anheuser and SIMON is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Anheuser Busch Inbev and SIMON PPTY GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIMON PPTY GROUP and Anheuser Busch 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 Anheuser Busch Inbev are associated (or correlated) with SIMON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIMON PPTY GROUP has no effect on the direction of Anheuser Busch i.e., Anheuser Busch and SIMON go up and down completely randomly.

Pair Corralation between Anheuser Busch and SIMON

Considering the 90-day investment horizon Anheuser Busch Inbev is expected to under-perform the SIMON. In addition to that, Anheuser Busch is 2.52 times more volatile than SIMON PPTY GROUP. It trades about -0.08 of its total potential returns per unit of risk. SIMON PPTY GROUP is currently generating about 0.01 per unit of volatility. If you would invest  8,716  in SIMON PPTY GROUP on May 17, 2025 and sell it today you would earn a total of  30.00  from holding SIMON PPTY GROUP or generate 0.34% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	68.85%
Values	Daily Returns

Anheuser Busch Inbev  vs.  SIMON PPTY GROUP

Anheuser Busch Inbev

Risk-Adjusted Performance

Weakest

Over the last 90 days Anheuser Busch Inbev has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

SIMON PPTY GROUP

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SIMON PPTY GROUP are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, SIMON is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Anheuser Busch and SIMON

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

The idea behind Anheuser Busch Inbev and SIMON PPTY GROUP 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.