Correlation Between Lineage, Common and Public Storage

Can any of the company-specific risk be diversified away by investing in both Lineage, Common 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 Lineage, Common and Public Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Lineage, Common Stock and Public Storage, you can compare the effects of market volatilities on Lineage, Common 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 Lineage, Common with a short position of Public Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lineage, Common and Public Storage.

Diversification Opportunities for Lineage, Common and Public Storage

0.55

Correlation Coefficient

Lineage, Common  Public Storage

Very weak diversification

The 3 months correlation between Lineage, and Public is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Lineage, Common Stock and Public Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Public Storage and Lineage, Common 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 Lineage, Common Stock 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 Lineage, Common i.e., Lineage, Common and Public Storage go up and down completely randomly.

Pair Corralation between Lineage, Common and Public Storage

Given the investment horizon of 90 days Lineage, Common Stock is expected to generate 1.71 times more return on investment than Public Storage. However, Lineage, Common is 1.71 times more volatile than Public Storage. It trades about 0.11 of its potential returns per unit of risk. Public Storage is currently generating about -0.02 per unit of risk. If you would invest  5,801  in Lineage, Common Stock on October 23, 2024 and sell it today you would earn a total of  210.00  from holding Lineage, Common Stock or generate 3.62% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Lineage, Common Stock  vs.  Public Storage

Lineage, Common Stock

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lineage, Common Stock has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Public Storage

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Public Storage has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Lineage, Common and Public Storage

The main advantage of trading using opposite Lineage, Common and Public Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lineage, Common 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.

The idea behind Lineage, Common Stock and Public Storage pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Transaction History module to view history of all your transactions and understand their impact on performance.