Correlation Between CubeSmart and LXP Industrial
Can any of the company-specific risk be diversified away by investing in both CubeSmart and LXP Industrial 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 CubeSmart and LXP Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CubeSmart and LXP Industrial Trust, you can compare the effects of market volatilities on CubeSmart and LXP Industrial 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 CubeSmart with a short position of LXP Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of CubeSmart and LXP Industrial.
Diversification Opportunities for CubeSmart and LXP Industrial
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CubeSmart and LXP is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding CubeSmart and LXP Industrial Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LXP Industrial Trust and CubeSmart 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 CubeSmart are associated (or correlated) with LXP Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LXP Industrial Trust has no effect on the direction of CubeSmart i.e., CubeSmart and LXP Industrial go up and down completely randomly.
Pair Corralation between CubeSmart and LXP Industrial
Given the investment horizon of 90 days CubeSmart is expected to generate 1.09 times more return on investment than LXP Industrial. However, CubeSmart is 1.09 times more volatile than LXP Industrial Trust. It trades about 0.12 of its potential returns per unit of risk. LXP Industrial Trust is currently generating about 0.0 per unit of risk. If you would invest 4,801 in CubeSmart on August 29, 2024 and sell it today you would earn a total of 213.00 from holding CubeSmart or generate 4.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CubeSmart vs. LXP Industrial Trust
Performance |
| Timeline |
| CubeSmart |
| LXP Industrial Trust |
CubeSmart and LXP Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CubeSmart and LXP Industrial
The main advantage of trading using opposite CubeSmart and LXP Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CubeSmart position performs unexpectedly, LXP Industrial 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 LXP Industrial will offset losses from the drop in LXP Industrial's long position.| CubeSmart vs. Public Storage | CubeSmart vs. National Storage Affiliates | CubeSmart vs. Prologis | CubeSmart vs. Extra Space Storage |
| LXP Industrial vs. First Industrial Realty | LXP Industrial vs. Plymouth Industrial REIT | LXP Industrial vs. Global Self Storage | LXP Industrial 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |