Correlation Between Prologis and SmartStop Self

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

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

Diversification Opportunities for Prologis and SmartStop Self

0.18

Correlation Coefficient

Prologis  SmartStop Self

Average diversification

The 3 months correlation between Prologis and SmartStop is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Prologis and SmartStop Self Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SmartStop Self Storage and Prologis 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 Prologis are associated (or correlated) with SmartStop Self. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SmartStop Self Storage has no effect on the direction of Prologis i.e., Prologis and SmartStop Self go up and down completely randomly.

Pair Corralation between Prologis and SmartStop Self

Considering the 90-day investment horizon Prologis is expected to under-perform the SmartStop Self. In addition to that, Prologis is 16.78 times more volatile than SmartStop Self Storage. It trades about -0.04 of its total potential returns per unit of risk. SmartStop Self Storage is currently generating about 0.2 per unit of volatility. If you would invest  3,289  in SmartStop Self Storage on May 15, 2025 and sell it today you would earn a total of  27.00  from holding SmartStop Self Storage or generate 0.82% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	86.89%
Values	Daily Returns

Prologis  vs.  SmartStop Self Storage

Prologis

Risk-Adjusted Performance

Weakest

Over the last 90 days Prologis has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound essential indicators, Prologis is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

SmartStop Self Storage

Risk-Adjusted Performance

Good

Over the last 90 days SmartStop Self Storage has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, SmartStop Self is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Prologis and SmartStop Self

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

The idea behind Prologis and SmartStop Self 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.