Correlation Between Public Storage and GX AI
Can any of the company-specific risk be diversified away by investing in both Public Storage and GX AI 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 Public Storage and GX AI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Public Storage and GX AI TECH, you can compare the effects of market volatilities on Public Storage and GX AI 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 Public Storage with a short position of GX AI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Public Storage and GX AI.
Diversification Opportunities for Public Storage and GX AI
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Public and BAIQ39 is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Public Storage and GX AI TECH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GX AI TECH and Public 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 Public Storage are associated (or correlated) with GX AI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GX AI TECH has no effect on the direction of Public Storage i.e., Public Storage and GX AI go up and down completely randomly.
Pair Corralation between Public Storage and GX AI
Assuming the 90 days trading horizon Public Storage is expected to under-perform the GX AI. But the stock apears to be less risky and, when comparing its historical volatility, Public Storage is 2.94 times less risky than GX AI. The stock trades about -0.18 of its potential returns per unit of risk. The GX AI TECH is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 7,000 in GX AI TECH on November 3, 2024 and sell it today you would earn a total of 792.00 from holding GX AI TECH or generate 11.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Public Storage vs. GX AI TECH
Performance |
| Timeline |
| Public Storage |
| GX AI TECH |
Public Storage and GX AI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Public Storage and GX AI
The main advantage of trading using opposite Public Storage and GX AI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Public Storage position performs unexpectedly, GX AI 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 GX AI will offset losses from the drop in GX AI's long position.| Public Storage vs. Fair Isaac | Public Storage vs. Hormel Foods | Public Storage vs. Take Two Interactive Software | Public Storage vs. Air Products and |
| GX AI vs. Taiwan Semiconductor Manufacturing | GX AI vs. Apple Inc | GX AI vs. Alibaba Group Holding | GX AI vs. Microsoft |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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