Correlation Between Shurgard Self and Montea CVA
Can any of the company-specific risk be diversified away by investing in both Shurgard Self and Montea CVA 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 Montea CVA 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 Montea CVA, you can compare the effects of market volatilities on Shurgard Self and Montea CVA 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 Montea CVA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shurgard Self and Montea CVA.
Diversification Opportunities for Shurgard Self and Montea CVA
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shurgard and Montea is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Shurgard Self Storage and Montea CVA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Montea CVA 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 Montea CVA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Montea CVA has no effect on the direction of Shurgard Self i.e., Shurgard Self and Montea CVA go up and down completely randomly.
Pair Corralation between Shurgard Self and Montea CVA
Assuming the 90 days trading horizon Shurgard Self Storage is expected to generate 1.02 times more return on investment than Montea CVA. However, Shurgard Self is 1.02 times more volatile than Montea CVA. It trades about -0.01 of its potential returns per unit of risk. Montea CVA is currently generating about -0.17 per unit of risk. If you would invest 3,944 in Shurgard Self Storage on September 2, 2024 and sell it today you would lose (84.00) from holding Shurgard Self Storage or give up 2.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shurgard Self Storage vs. Montea CVA
Performance |
| Timeline |
| Shurgard Self Storage |
| Montea CVA |
Shurgard Self and Montea CVA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shurgard Self and Montea CVA
The main advantage of trading using opposite Shurgard Self and Montea CVA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shurgard Self position performs unexpectedly, Montea CVA 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 Montea CVA will offset losses from the drop in Montea CVA's long position.| Shurgard Self vs. Immobiliere Distri Land NV | Shurgard Self vs. Immobel | Shurgard Self vs. Accentis | Shurgard Self vs. Exmar NV |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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