Correlation Between Terreno Realty and National Storage
Can any of the company-specific risk be diversified away by investing in both Terreno Realty 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 Terreno Realty and National Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Terreno Realty and National Storage Affiliates, you can compare the effects of market volatilities on Terreno Realty 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 Terreno Realty with a short position of National Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Terreno Realty and National Storage.
Diversification Opportunities for Terreno Realty and National Storage
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Terreno and National is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Terreno Realty and National Storage Affiliates in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Storage Aff and Terreno Realty 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 Terreno Realty 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 Aff has no effect on the direction of Terreno Realty i.e., Terreno Realty and National Storage go up and down completely randomly.
Pair Corralation between Terreno Realty and National Storage
Given the investment horizon of 90 days Terreno Realty is expected to generate 0.86 times more return on investment than National Storage. However, Terreno Realty is 1.16 times less risky than National Storage. It trades about 0.02 of its potential returns per unit of risk. National Storage Affiliates is currently generating about 0.01 per unit of risk. If you would invest 5,982 in Terreno Realty on November 9, 2024 and sell it today you would earn a total of 785.00 from holding Terreno Realty or generate 13.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Terreno Realty vs. National Storage Affiliates
Performance |
| Timeline |
| Terreno Realty |
| National Storage Aff |
Terreno Realty and National Storage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Terreno Realty and National Storage
The main advantage of trading using opposite Terreno Realty and National Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Terreno Realty 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.| Terreno Realty vs. Plymouth Industrial REIT | Terreno Realty vs. EastGroup Properties | Terreno Realty vs. LXP Industrial Trust | Terreno Realty vs. First Industrial Realty |
| National Storage vs. Extra Space Storage | National Storage vs. Americold Realty Trust | National Storage vs. Public Storage | National Storage vs. Terreno Realty |
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 Stocks Directory module to find actively traded stocks across global markets.
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