Correlation Between Public Storage and Big 5
Can any of the company-specific risk be diversified away by investing in both Public Storage and Big 5 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 Big 5 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Public Storage and Big 5 Sporting, you can compare the effects of market volatilities on Public Storage and Big 5 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 Big 5. Check out your portfolio center. Please also check ongoing floating volatility patterns of Public Storage and Big 5.
Diversification Opportunities for Public Storage and Big 5
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Public and Big is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Public Storage and Big 5 Sporting in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Big 5 Sporting 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 Big 5. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Big 5 Sporting has no effect on the direction of Public Storage i.e., Public Storage and Big 5 go up and down completely randomly.
Pair Corralation between Public Storage and Big 5
Assuming the 90 days horizon Public Storage is expected to generate 0.33 times more return on investment than Big 5. However, Public Storage is 3.07 times less risky than Big 5. It trades about 0.06 of its potential returns per unit of risk. Big 5 Sporting is currently generating about -0.07 per unit of risk. If you would invest 24,909 in Public Storage on September 1, 2024 and sell it today you would earn a total of 8,411 from holding Public Storage or generate 33.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Public Storage vs. Big 5 Sporting
Performance |
| Timeline |
| Public Storage |
| Big 5 Sporting |
Public Storage and Big 5 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Public Storage and Big 5
The main advantage of trading using opposite Public Storage and Big 5 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Public Storage position performs unexpectedly, Big 5 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 Big 5 will offset losses from the drop in Big 5's long position.| Public Storage vs. INDOFOOD AGRI RES | Public Storage vs. China BlueChemical | Public Storage vs. Lifeway Foods | Public Storage vs. TYSON FOODS A |
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.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |