Correlation Between Americold Realty and National Storage
Can any of the company-specific risk be diversified away by investing in both Americold Realty 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 Americold Realty and National Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Americold Realty Trust and National Storage Affiliates, you can compare the effects of market volatilities on Americold Realty 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 Americold Realty with a short position of National Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Americold Realty and National Storage.
Diversification Opportunities for Americold Realty and National Storage
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Americold and National is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Americold Realty Trust and National Storage Affiliates in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Storage Aff and Americold Realty 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 Americold Realty Trust 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 Aff has no effect on the direction of Americold Realty i.e., Americold Realty and National Storage go up and down completely randomly.
Pair Corralation between Americold Realty and National Storage
Given the investment horizon of 90 days Americold Realty Trust is expected to under-perform the National Storage. In addition to that, Americold Realty is 1.62 times more volatile than National Storage Affiliates. It trades about -0.15 of its total potential returns per unit of risk. National Storage Affiliates is currently generating about 0.15 per unit of volatility. If you would invest 4,302 in National Storage Affiliates on August 27, 2024 and sell it today you would earn a total of 212.00 from holding National Storage Affiliates or generate 4.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Americold Realty Trust vs. National Storage Affiliates
Performance |
| Timeline |
| Americold Realty Trust |
| National Storage Aff |
Americold Realty and National Storage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Americold Realty and National Storage
The main advantage of trading using opposite Americold Realty and National Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Americold Realty 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.| Americold Realty vs. Rexford Industrial Realty | Americold Realty vs. Terreno Realty | Americold Realty vs. First Industrial Realty | Americold Realty vs. Plymouth Industrial REIT |
| National Storage vs. Extra Space Storage | National Storage vs. Americold Realty Trust | National Storage vs. Public Storage | National Storage vs. Terreno Realty |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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