Correlation Between SIEM OFFSHORE and Public Storage

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

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

Diversification Opportunities for SIEM OFFSHORE and Public Storage

0.7

Correlation Coefficient

SIEM OFFSHORE  Public Storage

Poor diversification

The 3 months correlation between SIEM and Public is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding SIEM OFFSHORE NEW and Public Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Public Storage and SIEM OFFSHORE 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 SIEM OFFSHORE NEW 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 SIEM OFFSHORE i.e., SIEM OFFSHORE and Public Storage go up and down completely randomly.

Pair Corralation between SIEM OFFSHORE and Public Storage

Assuming the 90 days trading horizon SIEM OFFSHORE NEW is expected to generate 2.1 times more return on investment than Public Storage. However, SIEM OFFSHORE is 2.1 times more volatile than Public Storage. It trades about 0.05 of its potential returns per unit of risk. Public Storage is currently generating about 0.03 per unit of risk. If you would invest  116.00  in SIEM OFFSHORE NEW on September 26, 2024 and sell it today you would earn a total of  88.00  from holding SIEM OFFSHORE NEW or generate 75.86% return on investment over 90 days.

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

SIEM OFFSHORE NEW  vs.  Public Storage

SIEM OFFSHORE NEW

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SIEM OFFSHORE NEW has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's technical indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

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 uncertain performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with SIEM OFFSHORE and Public Storage

The main advantage of trading using opposite SIEM OFFSHORE and Public Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIEM OFFSHORE 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 SIEM OFFSHORE NEW 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.