Correlation Between Auswide Bank and National Storage
Can any of the company-specific risk be diversified away by investing in both Auswide Bank and National 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 Auswide Bank and National Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auswide Bank and National Storage REIT, you can compare the effects of market volatilities on Auswide Bank and National 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 Auswide Bank with a short position of National Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auswide Bank and National Storage.
Diversification Opportunities for Auswide Bank and National Storage
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Auswide and National is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Auswide Bank and National Storage REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Storage REIT and Auswide Bank 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 Auswide Bank are associated (or correlated) with National Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Storage REIT has no effect on the direction of Auswide Bank i.e., Auswide Bank and National Storage go up and down completely randomly.
Pair Corralation between Auswide Bank and National Storage
Assuming the 90 days trading horizon Auswide Bank is expected to under-perform the National Storage. In addition to that, Auswide Bank is 1.01 times more volatile than National Storage REIT. It trades about -0.01 of its total potential returns per unit of risk. National Storage REIT is currently generating about 0.03 per unit of volatility. If you would invest 215.00 in National Storage REIT on September 3, 2024 and sell it today you would earn a total of 35.00 from holding National Storage REIT or generate 16.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Auswide Bank vs. National Storage REIT
Performance |
| Timeline |
| Auswide Bank |
| National Storage REIT |
Auswide Bank and National Storage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auswide Bank and National Storage
The main advantage of trading using opposite Auswide Bank and National Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auswide Bank position performs unexpectedly, National 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 National Storage will offset losses from the drop in National Storage's long position.| Auswide Bank vs. Audio Pixels Holdings | Auswide Bank vs. Iodm | Auswide Bank vs. TTG Fintech | Auswide Bank vs. Mantle Minerals Limited |
| National Storage vs. Data3 | National Storage vs. Clime Investment Management | National Storage vs. Truscott Mining Corp | National Storage vs. Pinnacle Investment Management |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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