Correlation Between SmartStop Self and Americold Realty

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

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

Diversification Opportunities for SmartStop Self and Americold Realty

-0.72

Correlation Coefficient

SmartStop Self  Americold Realty

Pay attention - limited upside

The 3 months correlation between SmartStop and Americold is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding SmartStop Self Storage and Americold Realty Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Americold Realty Trust and SmartStop Self 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 SmartStop Self Storage are associated (or correlated) with Americold Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Americold Realty Trust has no effect on the direction of SmartStop Self i.e., SmartStop Self and Americold Realty go up and down completely randomly.

Pair Corralation between SmartStop Self and Americold Realty

Assuming the 90 days horizon SmartStop Self Storage is expected to generate 0.04 times more return on investment than Americold Realty. However, SmartStop Self Storage is 26.9 times less risky than Americold Realty. It trades about 0.18 of its potential returns per unit of risk. Americold Realty Trust is currently generating about -0.1 per unit of risk. If you would invest  3,289  in SmartStop Self Storage on May 1, 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 Against
Strength	Weak
Accuracy	96.83%
Values	Daily Returns

SmartStop Self Storage  vs.  Americold Realty Trust

SmartStop Self Storage

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SmartStop Self Storage are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. 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.

Americold Realty Trust

Risk-Adjusted Performance

Very Weak

Over the last 90 days Americold Realty Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's essential indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with SmartStop Self and Americold Realty

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

The idea behind SmartStop Self Storage and Americold Realty Trust 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.