Correlation Between PT Global and ASHFORD HOSPITTRUST

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Can any of the company-specific risk be diversified away by investing in both PT Global and ASHFORD HOSPITTRUST 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 PT Global and ASHFORD HOSPITTRUST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Global Mediacom and ASHFORD HOSPITTRUST, you can compare the effects of market volatilities on PT Global and ASHFORD HOSPITTRUST 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 PT Global with a short position of ASHFORD HOSPITTRUST. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Global and ASHFORD HOSPITTRUST.

Diversification Opportunities for PT Global and ASHFORD HOSPITTRUST

0.63
  Correlation Coefficient

Poor diversification

The 3 months correlation between 06L and ASHFORD is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding PT Global Mediacom and ASHFORD HOSPITTRUST in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASHFORD HOSPITTRUST and PT Global 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 PT Global Mediacom are associated (or correlated) with ASHFORD HOSPITTRUST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASHFORD HOSPITTRUST has no effect on the direction of PT Global i.e., PT Global and ASHFORD HOSPITTRUST go up and down completely randomly.

Pair Corralation between PT Global and ASHFORD HOSPITTRUST

If you would invest  505.00  in ASHFORD HOSPITTRUST on September 4, 2024 and sell it today you would earn a total of  0.00  from holding ASHFORD HOSPITTRUST or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

PT Global Mediacom  vs.  ASHFORD HOSPITTRUST

 Performance 
       Timeline  
PT Global Mediacom 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days PT Global Mediacom has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, PT Global is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.
ASHFORD HOSPITTRUST 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days ASHFORD HOSPITTRUST has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

PT Global and ASHFORD HOSPITTRUST Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with PT Global and ASHFORD HOSPITTRUST

The main advantage of trading using opposite PT Global and ASHFORD HOSPITTRUST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Global position performs unexpectedly, ASHFORD HOSPITTRUST 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 ASHFORD HOSPITTRUST will offset losses from the drop in ASHFORD HOSPITTRUST's long position.
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The idea behind PT Global Mediacom and ASHFORD HOSPITTRUST 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.

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