Correlation Between Shurgard Self and BEL Small
Can any of the company-specific risk be diversified away by investing in both Shurgard Self and BEL Small 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 Shurgard Self and BEL Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shurgard Self Storage and BEL Small, you can compare the effects of market volatilities on Shurgard Self and BEL Small 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 Shurgard Self with a short position of BEL Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shurgard Self and BEL Small.
Diversification Opportunities for Shurgard Self and BEL Small
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Shurgard and BEL is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Shurgard Self Storage and BEL Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BEL Small and Shurgard Self 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 Shurgard Self Storage are associated (or correlated) with BEL Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BEL Small has no effect on the direction of Shurgard Self i.e., Shurgard Self and BEL Small go up and down completely randomly.
Pair Corralation between Shurgard Self and BEL Small
Assuming the 90 days trading horizon Shurgard Self Storage is expected to generate 2.38 times more return on investment than BEL Small. However, Shurgard Self is 2.38 times more volatile than BEL Small. It trades about 0.01 of its potential returns per unit of risk. BEL Small is currently generating about -0.09 per unit of risk. If you would invest 4,033 in Shurgard Self Storage on August 29, 2024 and sell it today you would lose (113.00) from holding Shurgard Self Storage or give up 2.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Shurgard Self Storage vs. BEL Small
Performance |
| Timeline |
Shurgard Self and BEL Small Volatility Contrast
Predicted Return Density |
| Returns |
Shurgard Self Storage
Pair trading matchups for Shurgard Self
BEL Small
Pair trading matchups for BEL Small
Pair Trading with Shurgard Self and BEL Small
The main advantage of trading using opposite Shurgard Self and BEL Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shurgard Self position performs unexpectedly, BEL Small 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 BEL Small will offset losses from the drop in BEL Small's long position.| Shurgard Self vs. Warehouses de Pauw | Shurgard Self vs. Sofina Socit Anonyme | Shurgard Self vs. Aedifica | Shurgard Self vs. Xior Student Housing |
| BEL Small vs. Immolease Trust NV | BEL Small vs. Ion Beam Applications | BEL Small vs. Retail Estates | BEL Small vs. Keyware Technologies NV |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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