Correlation Between Aemetis and National Storage
Can any of the company-specific risk be diversified away by investing in both Aemetis and National 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 Aemetis and National Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aemetis and National Storage Affiliates, you can compare the effects of market volatilities on Aemetis and National 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 Aemetis with a short position of National Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aemetis and National Storage.
Diversification Opportunities for Aemetis and National Storage
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aemetis and National is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Aemetis and National Storage Affiliates in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Storage Aff and Aemetis 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 Aemetis are associated (or correlated) with National Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Storage Aff has no effect on the direction of Aemetis i.e., Aemetis and National Storage go up and down completely randomly.
Pair Corralation between Aemetis and National Storage
Given the investment horizon of 90 days Aemetis is expected to under-perform the National Storage. In addition to that, Aemetis is 1.72 times more volatile than National Storage Affiliates. It trades about -0.41 of its total potential returns per unit of risk. National Storage Affiliates is currently generating about -0.06 per unit of volatility. If you would invest 3,712 in National Storage Affiliates on January 26, 2024 and sell it today you would lose (134.00) from holding National Storage Affiliates or give up 3.61% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Aemetis vs. National Storage Affiliates
Performance |
Timeline |
Aemetis |
National Storage Aff |
Aemetis and National Storage Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Aemetis and National Storage
The main advantage of trading using opposite Aemetis and National Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aemetis position performs unexpectedly, National 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 National Storage will offset losses from the drop in National Storage's long position.Aemetis vs. PBF Energy | Aemetis vs. Clean Energy Fuels | Aemetis vs. Par Pacific Holdings | Aemetis vs. Vertex Energy |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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