Correlation Between SoftBank Group and Public Storage
Can any of the company-specific risk be diversified away by investing in both SoftBank Group 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 SoftBank Group and Public Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SoftBank Group Corp and Public Storage, you can compare the effects of market volatilities on SoftBank Group 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 SoftBank Group with a short position of Public Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of SoftBank Group and Public Storage.
Diversification Opportunities for SoftBank Group and Public Storage
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SoftBank and Public is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding SoftBank Group Corp and Public Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Public Storage and SoftBank Group 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 SoftBank Group Corp 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 has no effect on the direction of SoftBank Group i.e., SoftBank Group and Public Storage go up and down completely randomly.
Pair Corralation between SoftBank Group and Public Storage
Assuming the 90 days trading horizon SoftBank Group Corp is expected to generate 2.47 times more return on investment than Public Storage. However, SoftBank Group is 2.47 times more volatile than Public Storage. It trades about 0.11 of its potential returns per unit of risk. Public Storage is currently generating about -0.01 per unit of risk. If you would invest 715,426 in SoftBank Group Corp on November 4, 2024 and sell it today you would earn a total of 225,674 from holding SoftBank Group Corp or generate 31.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 67.97% |
| Values | Daily Returns |
SoftBank Group Corp vs. Public Storage
Performance |
| Timeline |
| SoftBank Group Corp |
| Public Storage |
SoftBank Group and Public Storage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SoftBank Group and Public Storage
The main advantage of trading using opposite SoftBank Group and Public Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SoftBank Group 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.| SoftBank Group vs. Eco Animal Health | SoftBank Group vs. EJF Investments | SoftBank Group vs. Bankers Investment Trust | SoftBank Group vs. Scandinavian Tobacco Group |
| Public Storage vs. Vietnam Enterprise Investments | Public Storage vs. Fonix Mobile plc | Public Storage vs. Chrysalis Investments | Public Storage vs. OneSavings Bank PLC |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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