Correlation Between Shurgard Self and Inclusio Sca

Can any of the company-specific risk be diversified away by investing in both Shurgard Self and Inclusio Sca 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 Shurgard Self and Inclusio Sca into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Shurgard Self and Inclusio Sca

0.62

Correlation Coefficient

Shurgard Self  Inclusio Sca

Poor diversification

The 3 months correlation between Shurgard and Inclusio is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Shurgard Self Storage and Inclusio Sca in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inclusio Sca and Shurgard Self 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 Shurgard Self Storage are associated (or correlated) with Inclusio Sca. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inclusio Sca has no effect on the direction of Shurgard Self i.e., Shurgard Self and Inclusio Sca go up and down completely randomly.

Pair Corralation between Shurgard Self and Inclusio Sca

Assuming the 90 days trading horizon Shurgard Self Storage is expected to under-perform the Inclusio Sca. But the stock apears to be less risky and, when comparing its historical volatility, Shurgard Self Storage is 1.12 times less risky than Inclusio Sca. The stock trades about -0.14 of its potential returns per unit of risk. The Inclusio Sca is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest  1,475  in Inclusio Sca on September 14, 2024 and sell it today you would lose (145.00) from holding Inclusio Sca or give up 9.83% of portfolio value over 90 days.

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

Shurgard Self Storage  vs.  Inclusio Sca

Shurgard Self Storage

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Shurgard Self Storage has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Inclusio Sca

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Inclusio Sca has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental drivers 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 Shurgard Self and Inclusio Sca

The main advantage of trading using opposite Shurgard Self and Inclusio Sca positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shurgard Self position performs unexpectedly, Inclusio Sca 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 Inclusio Sca will offset losses from the drop in Inclusio Sca's long position.

The idea behind Shurgard Self Storage and Inclusio Sca 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.