Correlation Between Perimeter Solutions and Data Storage

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

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

Diversification Opportunities for Perimeter Solutions and Data Storage

0.54

Correlation Coefficient

Perimeter Solutions  Data Storage

Very weak diversification

The 3 months correlation between Perimeter and Data is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Perimeter Solutions SA and Data Storage Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Data Storage Corp and Perimeter Solutions 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 Perimeter Solutions SA are associated (or correlated) with Data Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Data Storage Corp has no effect on the direction of Perimeter Solutions i.e., Perimeter Solutions and Data Storage go up and down completely randomly.

Pair Corralation between Perimeter Solutions and Data Storage

Considering the 90-day investment horizon Perimeter Solutions is expected to generate 1.03 times less return on investment than Data Storage. But when comparing it to its historical volatility, Perimeter Solutions SA is 2.91 times less risky than Data Storage. It trades about 0.24 of its potential returns per unit of risk. Data Storage Corp is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  357.00  in Data Storage Corp on May 5, 2025 and sell it today you would earn a total of  111.00  from holding Data Storage Corp or generate 31.09% return on investment over 90 days.

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

Perimeter Solutions SA  vs.  Data Storage Corp

Perimeter Solutions

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Perimeter Solutions SA are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Perimeter Solutions displayed solid returns over the last few months and may actually be approaching a breakup point.

Data Storage Corp

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Data Storage Corp are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Data Storage unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Perimeter Solutions and Data Storage

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

The idea behind Perimeter Solutions SA and Data Storage Corp 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.