Correlation Between Regal Investment and National Storage
Can any of the company-specific risk be diversified away by investing in both Regal Investment 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 Regal Investment and National Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regal Investment and National Storage REIT, you can compare the effects of market volatilities on Regal Investment 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 Regal Investment with a short position of National Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regal Investment and National Storage.
Diversification Opportunities for Regal Investment and National Storage
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Regal and National is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Regal Investment and National Storage REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Storage REIT and Regal Investment 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 Regal Investment 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 REIT has no effect on the direction of Regal Investment i.e., Regal Investment and National Storage go up and down completely randomly.
Pair Corralation between Regal Investment and National Storage
Assuming the 90 days trading horizon Regal Investment is expected to generate 1.09 times more return on investment than National Storage. However, Regal Investment is 1.09 times more volatile than National Storage REIT. It trades about 0.05 of its potential returns per unit of risk. National Storage REIT is currently generating about 0.03 per unit of risk. If you would invest 267.00 in Regal Investment on August 24, 2024 and sell it today you would earn a total of 86.00 from holding Regal Investment or generate 32.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Regal Investment vs. National Storage REIT
Performance |
| Timeline |
| Regal Investment |
| National Storage REIT |
Regal Investment and National Storage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regal Investment and National Storage
The main advantage of trading using opposite Regal Investment and National Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regal Investment 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.| Regal Investment vs. Kkr Credit Income | Regal Investment vs. Collins Foods | Regal Investment vs. Qbe Insurance Group | Regal Investment vs. Finexia Financial Group |
| National Storage vs. Scentre Group | National Storage vs. Vicinity Centres Re | National Storage vs. Cromwell Property Group | National Storage vs. GDI Property Group |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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