Correlation Between Corning Incorporated and National Storage
Can any of the company-specific risk be diversified away by investing in both Corning Incorporated 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 Corning Incorporated and National Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Corning Incorporated and National Storage Affiliates, you can compare the effects of market volatilities on Corning Incorporated 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 Corning Incorporated with a short position of National Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Corning Incorporated and National Storage.
Diversification Opportunities for Corning Incorporated and National Storage
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Corning and National is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Corning Incorporated 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 Corning Incorporated 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 Corning Incorporated 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 Corning Incorporated i.e., Corning Incorporated and National Storage go up and down completely randomly.
Pair Corralation between Corning Incorporated and National Storage
Considering the 90-day investment horizon Corning Incorporated is expected to generate 0.44 times more return on investment than National Storage. However, Corning Incorporated is 2.27 times less risky than National Storage. It trades about -0.1 of its potential returns per unit of risk. National Storage Affiliates is currently generating about -0.06 per unit of risk. If you would invest 3,231 in Corning Incorporated on January 26, 2024 and sell it today you would lose (79.00) from holding Corning Incorporated or give up 2.45% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Corning Incorporated vs. National Storage Affiliates
Performance |
Timeline |
Corning Incorporated |
National Storage Aff |
Corning Incorporated and National Storage Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Corning Incorporated and National Storage
The main advantage of trading using opposite Corning Incorporated and National Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Corning Incorporated 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.Corning Incorporated vs. OSI Systems | Corning Incorporated vs. Fabrinet | Corning Incorporated vs. Jabil Circuit | Corning Incorporated vs. Vicor |
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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