Correlation Between SmartStop Self and Infosys
Can any of the company-specific risk be diversified away by investing in both SmartStop Self and Infosys 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 Infosys 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 Infosys Ltd ADR, you can compare the effects of market volatilities on SmartStop Self and Infosys 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 Infosys. Check out your portfolio center. Please also check ongoing floating volatility patterns of SmartStop Self and Infosys.
Diversification Opportunities for SmartStop Self and Infosys
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SmartStop and Infosys is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding SmartStop Self Storage and Infosys Ltd ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infosys Ltd ADR 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 Infosys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infosys Ltd ADR has no effect on the direction of SmartStop Self i.e., SmartStop Self and Infosys go up and down completely randomly.
Pair Corralation between SmartStop Self and Infosys
Assuming the 90 days horizon SmartStop Self is expected to generate 2.02 times less return on investment than Infosys. But when comparing it to its historical volatility, SmartStop Self Storage is 18.17 times less risky than Infosys. It trades about 0.22 of its potential returns per unit of risk. Infosys Ltd ADR is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,709 in Infosys Ltd ADR on April 28, 2025 and sell it today you would earn a total of 28.00 from holding Infosys Ltd ADR or generate 1.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 96.92% |
Values | Daily Returns |
SmartStop Self Storage vs. Infosys Ltd ADR
Performance |
Timeline |
SmartStop Self Storage |
Infosys Ltd ADR |
SmartStop Self and Infosys Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SmartStop Self and Infosys
The main advantage of trading using opposite SmartStop Self and Infosys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SmartStop Self position performs unexpectedly, Infosys 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 Infosys will offset losses from the drop in Infosys' long position.SmartStop Self vs. FIBRA Macquarie Mxico | SmartStop Self vs. Industrial Logistics Properties | SmartStop Self vs. Fibra UNO | SmartStop Self vs. FIBRA Prologis |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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