Correlation Between Fidelity National and PUBLIC STORAGE

Can any of the company-specific risk be diversified away by investing in both Fidelity National 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 Fidelity National and PUBLIC STORAGE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fidelity National Information and PUBLIC STORAGE PRFO, you can compare the effects of market volatilities on Fidelity National 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 Fidelity National with a short position of PUBLIC STORAGE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity National and PUBLIC STORAGE.

Diversification Opportunities for Fidelity National and PUBLIC STORAGE

0.72

Correlation Coefficient

Fidelity National  PUBLIC STORAGE

Poor diversification

The 3 months correlation between Fidelity and PUBLIC is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity National Information and PUBLIC STORAGE PRFO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PUBLIC STORAGE PRFO and Fidelity National 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 Fidelity National Information 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 PRFO has no effect on the direction of Fidelity National i.e., Fidelity National and PUBLIC STORAGE go up and down completely randomly.

Pair Corralation between Fidelity National and PUBLIC STORAGE

Assuming the 90 days trading horizon Fidelity National Information is expected to under-perform the PUBLIC STORAGE. In addition to that, Fidelity National is 2.19 times more volatile than PUBLIC STORAGE PRFO. It trades about -0.11 of its total potential returns per unit of risk. PUBLIC STORAGE PRFO is currently generating about -0.09 per unit of volatility. If you would invest  1,625  in PUBLIC STORAGE PRFO on November 29, 2024 and sell it today you would lose (105.00) from holding PUBLIC STORAGE PRFO or give up 6.46% of portfolio value over 90 days.

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

Fidelity National Information  vs.  PUBLIC STORAGE PRFO

Fidelity National

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fidelity National Information has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in March 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

PUBLIC STORAGE PRFO

Risk-Adjusted Performance

Very Weak

Over the last 90 days PUBLIC STORAGE PRFO has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile 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 Fidelity National and PUBLIC STORAGE

The main advantage of trading using opposite Fidelity National and PUBLIC STORAGE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity National 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 Fidelity National Information and PUBLIC STORAGE PRFO 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.

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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.