Correlation Between American Assets and Public Storage
Can any of the company-specific risk be diversified away by investing in both American Assets and Public 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 American Assets and Public Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Assets Trust and Public Storage, you can compare the effects of market volatilities on American Assets and Public 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 American Assets with a short position of Public Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Assets and Public Storage.
Diversification Opportunities for American Assets and Public Storage
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between American and Public is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding American Assets Trust and Public Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Public Storage and American Assets 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 American Assets Trust are associated (or correlated) with Public Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Public Storage has no effect on the direction of American Assets i.e., American Assets and Public Storage go up and down completely randomly.
Pair Corralation between American Assets and Public Storage
Considering the 90-day investment horizon American Assets Trust is expected to under-perform the Public Storage. In addition to that, American Assets is 1.43 times more volatile than Public Storage. It trades about -0.21 of its total potential returns per unit of risk. Public Storage is currently generating about 0.01 per unit of volatility. If you would invest 29,289 in Public Storage on December 29, 2024 and sell it today you would earn a total of 148.00 from holding Public Storage or generate 0.51% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
American Assets Trust vs. Public Storage
Performance |
Timeline |
American Assets Trust |
Public Storage |
American Assets and Public Storage Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with American Assets and Public Storage
The main advantage of trading using opposite American Assets and Public Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Assets position performs unexpectedly, Public 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 Public Storage will offset losses from the drop in Public Storage's long position.American Assets vs. Essential Properties Realty | American Assets vs. Armada Hflr Pr | American Assets vs. CTO Realty Growth | American Assets vs. Brightspire Capital |
Public Storage vs. CubeSmart | Public Storage vs. National Storage Affiliates | Public Storage vs. Prologis | Public Storage vs. STAG Industrial |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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