Correlation Between Life Storage and Extra Space
Can any of the company-specific risk be diversified away by investing in both Life Storage and Extra Space 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 Life Storage and Extra Space into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Life Storage and Extra Space Storage, you can compare the effects of market volatilities on Life Storage and Extra Space 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 Life Storage with a short position of Extra Space. Check out your portfolio center. Please also check ongoing floating volatility patterns of Life Storage and Extra Space.
Diversification Opportunities for Life Storage and Extra Space
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Life and Extra is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Life Storage and Extra Space Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Extra Space Storage and Life 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 Life Storage are associated (or correlated) with Extra Space. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Extra Space Storage has no effect on the direction of Life Storage i.e., Life Storage and Extra Space go up and down completely randomly.
Pair Corralation between Life Storage and Extra Space
If you would invest 14,801 in Extra Space Storage on November 9, 2024 and sell it today you would earn a total of 804.00 from holding Extra Space Storage or generate 5.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Life Storage vs. Extra Space Storage
Performance |
| Timeline |
| Life Storage |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Extra Space Storage |
Life Storage and Extra Space Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Life Storage and Extra Space
The main advantage of trading using opposite Life Storage and Extra Space positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Life Storage position performs unexpectedly, Extra Space 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 Extra Space will offset losses from the drop in Extra Space's long position.| Life Storage vs. Public Storage | Life Storage vs. CubeSmart | Life Storage vs. National Storage Affiliates | Life Storage vs. Prologis |
| Extra Space vs. CubeSmart | Extra Space vs. National Storage Affiliates | Extra Space vs. Public Storage | Extra Space vs. EastGroup Properties |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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