Correlation Between PT Global and PUBLIC STORAGE
Can any of the company-specific risk be diversified away by investing in both PT Global and PUBLIC STORAGE 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 PT Global and PUBLIC STORAGE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Global Mediacom and PUBLIC STORAGE PRFO, you can compare the effects of market volatilities on PT Global and PUBLIC STORAGE 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 PT Global with a short position of PUBLIC STORAGE. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Global and PUBLIC STORAGE.
Diversification Opportunities for PT Global and PUBLIC STORAGE
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between 06L and PUBLIC is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding PT Global Mediacom and PUBLIC STORAGE PRFO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PUBLIC STORAGE PRFO and PT Global 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 PT Global Mediacom are associated (or correlated) with PUBLIC STORAGE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PUBLIC STORAGE PRFO has no effect on the direction of PT Global i.e., PT Global and PUBLIC STORAGE go up and down completely randomly.
Pair Corralation between PT Global and PUBLIC STORAGE
Assuming the 90 days trading horizon PT Global Mediacom is expected to generate 10.63 times more return on investment than PUBLIC STORAGE. However, PT Global is 10.63 times more volatile than PUBLIC STORAGE PRFO. It trades about 0.02 of its potential returns per unit of risk. PUBLIC STORAGE PRFO is currently generating about 0.03 per unit of risk. If you would invest 1.25 in PT Global Mediacom on September 1, 2024 and sell it today you would lose (0.50) from holding PT Global Mediacom or give up 40.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Global Mediacom vs. PUBLIC STORAGE PRFO
Performance |
| Timeline |
| PT Global Mediacom |
| PUBLIC STORAGE PRFO |
PT Global and PUBLIC STORAGE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Global and PUBLIC STORAGE
The main advantage of trading using opposite PT Global and PUBLIC STORAGE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Global position performs unexpectedly, PUBLIC STORAGE 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 PUBLIC STORAGE will offset losses from the drop in PUBLIC STORAGE's long position.| PT Global vs. Netflix | PT Global vs. Warner Music Group | PT Global vs. Superior Plus Corp | PT Global vs. NMI Holdings |
| PUBLIC STORAGE vs. Lyxor 1 | PUBLIC STORAGE vs. Xtrackers ShortDAX | PUBLIC STORAGE vs. Xtrackers LevDAX | PUBLIC STORAGE vs. Superior Plus Corp |
Check out your portfolio center.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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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