Life Storage Stock Volatility

LSI
 Stock
  

USD 113.72  1.82  1.58%   

Life Storage has Sharpe Ratio of -0.14, which conveys that the firm had -0.14% of return per unit of risk over the last 3 months. Macroaxis standpoint towards estimating the risk of any stock is to look at both systematic and unsystematic factors of the business, including all available market data and technical indicators. Life Storage exposes twenty-eight different technical indicators, which can help you to evaluate volatility that cannot be diversified away. Please be advised to verify Life Storage mean deviation of 1.74, and Risk Adjusted Performance of (0.17) to check out the risk estimate we provide.
  
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Life Storage Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Life Storage daily returns, and it is calculated using variance and standard deviation. We also use Life Storage's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Life Storage volatility.

690 Days Market Risk

Very steady

Chance of Distress

Below Average

690 Days Economic Sensitivity

Almost mirrors the market
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Life Storage can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Life Storage at lower prices. For example, an investor can purchase Life Storage stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Life Storage's stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.

Moving together with Life Storage

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Moving against Life Storage

0.63ACCAmerican Campus CommPairCorr

Life Storage Market Sensitivity And Downside Risk

Life Storage's beta coefficient measures the volatility of Life Storage stock compared to the systematic risk of the entire stock market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Life Storage stock's returns against your selected market. In other words, Life Storage's beta of 1.19 provides an investor with an approximation of how much risk Life Storage stock can potentially add to one of your existing portfolios.
Let's try to break down what Life Storage's beta means in this case. As the market goes up, the company is expected to outperform it. However, if the market returns are negative, Life Storage will likely underperform.
3 Months Beta |Analyze Life Storage Demand Trend
Check current 90 days Life Storage correlation with market (DOW)

Life Storage Beta

    
  1.19  
Life Storage standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. Typical volatile equity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

    
  2.36  
It is essential to understand the difference between upside risk (as represented by Life Storage's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Life Storage stock's daily returns or price. Since the actual investment returns on holding a position in Life Storage stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Life Storage.

Life Storage Implied Volatility

    
  50.87  
Life Storage's implied volatility exposes the market's sentiment of Life Storage stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Life Storage's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Life Storage stock will not fluctuate a lot when Life Storage's options are near their expiration.

Life Storage Stock Volatility Analysis

Volatility refers to the frequency at which Life Storage stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Life Storage's price changes. Investors will then calculate the volatility of Life Storage's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Life Storage's volatility:

Historical Volatility

This type of stock volatility measures Life Storage's fluctuations based on previous trends. It's commonly used to predict Life Storage's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.

Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for Life Storage's current market price. This means that the stock will return to its initially predicted market price.
Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. Life Storage Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
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Life Storage Projected Return Density Against Market

Considering the 90-day investment horizon the stock has the beta coefficient of 1.1891 . This indicates as the benchmark fluctuates upward, the company is expected to outperform it on average. However, if the benchmark returns are projected to be negative, Life Storage will likely underperform.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Life Storage or Real Estate sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Life Storage stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Life Storage stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
The company has a negative alpha, implying that the risk taken by holding this instrument is not justified. Life Storage is significantly underperforming DOW.
 Predicted Return Density 
      Returns 
Life Storage's volatility is measured either by using standard deviation or beta. Standard deviation will reflect the average amount of how Life Storage stock's price will differ from the mean after some time.To get its calculation, you should first determine the mean price during the specified period then subtract that from each price point.

What Drives a Company's Stock Price Volatility?

Several factors can influence a company's stock volatility:

Industry

Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.

Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.

The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.

Life Storage Stock Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Life Storage or Real Estate sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Life Storage stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Life Storage stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Considering the 90-day investment horizon the coefficient of variation of Life Storage is -698.08. The daily returns are distributed with a variance of 5.56 and standard deviation of 2.36. The mean deviation of Life Storage is currently at 1.74. For similar time horizon, the selected benchmark (DOW) has volatility of 1.42
α
Alpha over DOW
-0.06
β
Beta against DOW1.19
σ
Overall volatility
2.36
Ir
Information ratio -0.04

Life Storage Stock Return Volatility

Life Storage historical daily return volatility represents how much Life Storage stock's price daily returns swing around its mean daily price change - it is a statistical measure of its dispersion of returns. The company has volatility of 2.3571% on return distribution over 90 days investment horizon. By contrast, DOW inherits 1.4875% risk (volatility on return distribution) over the 90 days horizon.
 Performance (%) 
      Timeline 

About Life Storage Volatility

Volatility is a rate at which the price of Life Storage or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Life Storage may increase or decrease. In other words, similar to Life Storage's beta indicator, it measures the risk of Life Storage and helps estimate the fluctuations that may happen in a short period of time. So if prices of Life Storage fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.
Last ReportedProjected for 2022
Market Capitalization12.6 B13.6 B
Life Storage, Inc. is a self-administered and self-managed equity REIT that is in the business of acquiring and managing self-storage facilities. Life Storage consistently provides responsive service to approximately 500,000 customers, making it a leader in the industry. Life Storage operates under REITIndustrial classification in the United States and is traded on New York Stock Exchange. It employs 2241 people.

Life Storage Investment Opportunity

Life Storage has a volatility of 2.36 and is 1.58 times more volatile than DOW. 20  of all equities and portfolios are less risky than Life Storage. Compared to the overall equity markets, volatility of historical daily returns of Life Storage is lower than 20 () of all global equities and portfolios over the last 90 days. Use Life Storage to protect your portfolios against small market fluctuations. The stock experiences a somewhat bearish sentiment, but the market may correct it shortly. Check odds of Life Storage to be traded at $110.31 in 90 days. . Let's try to break down what Life Storage's beta means in this case. As the market goes up, the company is expected to outperform it. However, if the market returns are negative, Life Storage will likely underperform.

Poor diversification

The correlation between Life Storage and DJI is Poor diversification for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Life Storage and DJI in the same portfolio, assuming nothing else is changed.

Life Storage Additional Risk Indicators

The analysis of Life Storage's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Life Storage's investment and either accepting that risk or mitigating it. Along with some common measures of Life Storage stock risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Risk Adjusted Performance(0.17)
Market Risk Adjusted Performance(0.23)
Mean Deviation1.74
Coefficient Of Variation(833.56)
Standard Deviation2.33
Variance5.43
Information Ratio(0.04204)
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stock investments, we recommend comparing similar equities with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

Life Storage Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
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The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Life Storage as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Life Storage's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Life Storage's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Life Storage.
Additionally, see Stocks Correlation. Note that the Life Storage information on this page should be used as a complementary analysis to other Life Storage's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.

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When running Life Storage price analysis, check to measure Life Storage's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Life Storage is operating at the current time. Most of Life Storage's value examination focuses on studying past and present price action to predict the probability of Life Storage's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Life Storage's price. Additionally, you may evaluate how the addition of Life Storage to your portfolios can decrease your overall portfolio volatility.
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Is Life Storage's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Life Storage. If investors know Life Storage will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Life Storage listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth YOY
0.4
Market Capitalization
9.9 B
Quarterly Revenue Growth YOY
0.36
Return On Assets
0.0398
Return On Equity
0.0892
The market value of Life Storage is measured differently than its book value, which is the value of Life Storage that is recorded on the company's balance sheet. Investors also form their own opinion of Life Storage's value that differs from its market value or its book value, called intrinsic value, which is Life Storage's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Life Storage's market value can be influenced by many factors that don't directly affect Life Storage's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Life Storage's value and its price as these two are different measures arrived at by different means. Investors typically determine Life Storage value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Life Storage's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.