Correlation Between Extra Space and Athelney Trust
Can any of the company-specific risk be diversified away by investing in both Extra Space and Athelney Trust 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 Extra Space and Athelney Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Extra Space Storage and Athelney Trust plc, you can compare the effects of market volatilities on Extra Space and Athelney Trust 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 Extra Space with a short position of Athelney Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Extra Space and Athelney Trust.
Diversification Opportunities for Extra Space and Athelney Trust
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Extra and Athelney is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Extra Space Storage and Athelney Trust plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Athelney Trust plc and Extra Space 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 Extra Space Storage are associated (or correlated) with Athelney Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Athelney Trust plc has no effect on the direction of Extra Space i.e., Extra Space and Athelney Trust go up and down completely randomly.
Pair Corralation between Extra Space and Athelney Trust
Assuming the 90 days trading horizon Extra Space Storage is expected to generate 2.63 times more return on investment than Athelney Trust. However, Extra Space is 2.63 times more volatile than Athelney Trust plc. It trades about 0.03 of its potential returns per unit of risk. Athelney Trust plc is currently generating about -0.03 per unit of risk. If you would invest 14,214 in Extra Space Storage on August 25, 2024 and sell it today you would earn a total of 2,548 from holding Extra Space Storage or generate 17.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.79% |
| Values | Daily Returns |
Extra Space Storage vs. Athelney Trust plc
Performance |
| Timeline |
| Extra Space Storage |
| Athelney Trust plc |
Extra Space and Athelney Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Extra Space and Athelney Trust
The main advantage of trading using opposite Extra Space and Athelney Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Extra Space position performs unexpectedly, Athelney Trust 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 Athelney Trust will offset losses from the drop in Athelney Trust's long position.| Extra Space vs. Fonix Mobile plc | Extra Space vs. Gamma Communications PLC | Extra Space vs. Zoom Video Communications | Extra Space vs. Zinc Media Group |
| Athelney Trust vs. United States Steel | Athelney Trust vs. JLEN Environmental Assets | Athelney Trust vs. Synthomer plc | Athelney Trust vs. Extra Space Storage |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |