Correlation Between National Storage and ZTO Express
Can any of the company-specific risk be diversified away by investing in both National Storage and ZTO Express 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 National Storage and ZTO Express into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Storage Affiliates and ZTO Express, you can compare the effects of market volatilities on National Storage and ZTO Express 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 National Storage with a short position of ZTO Express. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Storage and ZTO Express.
Diversification Opportunities for National Storage and ZTO Express
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between National and ZTO is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding National Storage Affiliates and ZTO Express in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZTO Express and National Storage 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 National Storage Affiliates are associated (or correlated) with ZTO Express. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZTO Express has no effect on the direction of National Storage i.e., National Storage and ZTO Express go up and down completely randomly.
Pair Corralation between National Storage and ZTO Express
Assuming the 90 days horizon National Storage Affiliates is expected to generate 0.75 times more return on investment than ZTO Express. However, National Storage Affiliates is 1.34 times less risky than ZTO Express. It trades about 0.13 of its potential returns per unit of risk. ZTO Express is currently generating about -0.05 per unit of risk. If you would invest 3,263 in National Storage Affiliates on September 1, 2024 and sell it today you would earn a total of 1,007 from holding National Storage Affiliates or generate 30.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.24% |
| Values | Daily Returns |
National Storage Affiliates vs. ZTO Express
Performance |
| Timeline |
| National Storage Aff |
| ZTO Express |
National Storage and ZTO Express Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Storage and ZTO Express
The main advantage of trading using opposite National Storage and ZTO Express positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Storage position performs unexpectedly, ZTO Express 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 ZTO Express will offset losses from the drop in ZTO Express' long position.| National Storage vs. Extra Space Storage | National Storage vs. Superior Plus Corp | National Storage vs. NMI Holdings | National Storage vs. Origin Agritech |
| ZTO Express vs. Pure Storage | ZTO Express vs. Plastic Omnium | ZTO Express vs. Datang International Power | ZTO Express vs. Compagnie Plastic Omnium |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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