Correlation Between HF SINCLAIR and National Storage
Can any of the company-specific risk be diversified away by investing in both HF SINCLAIR 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 HF SINCLAIR and National Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HF SINCLAIR P and National Storage Affiliates, you can compare the effects of market volatilities on HF SINCLAIR 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 HF SINCLAIR with a short position of National Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of HF SINCLAIR and National Storage.
Diversification Opportunities for HF SINCLAIR and National Storage
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HL80 and National is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding HF SINCLAIR P 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 HF SINCLAIR 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 HF SINCLAIR P 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 HF SINCLAIR i.e., HF SINCLAIR and National Storage go up and down completely randomly.
Pair Corralation between HF SINCLAIR and National Storage
Assuming the 90 days trading horizon HF SINCLAIR P is expected to under-perform the National Storage. But the stock apears to be less risky and, when comparing its historical volatility, HF SINCLAIR P is 1.1 times less risky than National Storage. The stock trades about -0.1 of its potential returns per unit of risk. The National Storage Affiliates is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 3,972 in National Storage Affiliates on September 9, 2024 and sell it today you would earn a total of 112.00 from holding National Storage Affiliates or generate 2.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HF SINCLAIR P vs. National Storage Affiliates
Performance |
| Timeline |
| HF SINCLAIR P |
| National Storage Aff |
HF SINCLAIR and National Storage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HF SINCLAIR and National Storage
The main advantage of trading using opposite HF SINCLAIR and National Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HF SINCLAIR 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.| HF SINCLAIR vs. Reliance Industries Limited | HF SINCLAIR vs. Marathon Petroleum Corp | HF SINCLAIR vs. Valero Energy | HF SINCLAIR vs. Phillips 66 |
| National Storage vs. Extra Space Storage | National Storage vs. Montea Comm VA | National Storage vs. GLADSTONE LAND L 001 |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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