Correlation Between Sabien Technology and Extra Space
Can any of the company-specific risk be diversified away by investing in both Sabien Technology and Extra Space 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 Sabien Technology and Extra Space into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sabien Technology Group and Extra Space Storage, you can compare the effects of market volatilities on Sabien Technology and Extra Space 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 Sabien Technology with a short position of Extra Space. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabien Technology and Extra Space.
Diversification Opportunities for Sabien Technology and Extra Space
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sabien and Extra is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Sabien Technology Group and Extra Space Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Extra Space Storage and Sabien Technology 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 Sabien Technology Group are associated (or correlated) with Extra Space. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Extra Space Storage has no effect on the direction of Sabien Technology i.e., Sabien Technology and Extra Space go up and down completely randomly.
Pair Corralation between Sabien Technology and Extra Space
Assuming the 90 days trading horizon Sabien Technology is expected to generate 2.49 times less return on investment than Extra Space. In addition to that, Sabien Technology is 1.97 times more volatile than Extra Space Storage. It trades about 0.0 of its total potential returns per unit of risk. Extra Space Storage is currently generating about 0.01 per unit of volatility. If you would invest 15,282 in Extra Space Storage on October 29, 2024 and sell it today you would lose (95.00) from holding Extra Space Storage or give up 0.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.12% |
| Values | Daily Returns |
Sabien Technology Group vs. Extra Space Storage
Performance |
| Timeline |
| Sabien Technology |
| Extra Space Storage |
Sabien Technology and Extra Space Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sabien Technology and Extra Space
The main advantage of trading using opposite Sabien Technology and Extra Space positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabien Technology position performs unexpectedly, Extra Space 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 Extra Space will offset losses from the drop in Extra Space's long position.| Sabien Technology vs. International Biotechnology Trust | Sabien Technology vs. Eastman Chemical Co | Sabien Technology vs. Cognizant Technology Solutions | Sabien Technology vs. Central Asia Metals |
| Extra Space vs. Verizon Communications | Extra Space vs. Batm Advanced Communications | Extra Space vs. Zoom Video Communications | Extra Space vs. MTI Wireless Edge |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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