Correlation Between Xenia Hotels and Perma-Fix Environmental
Can any of the company-specific risk be diversified away by investing in both Xenia Hotels and Perma-Fix Environmental 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 Xenia Hotels and Perma-Fix Environmental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xenia Hotels Resorts and Perma Fix Environmental Services, you can compare the effects of market volatilities on Xenia Hotels and Perma-Fix Environmental 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 Xenia Hotels with a short position of Perma-Fix Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xenia Hotels and Perma-Fix Environmental.
Diversification Opportunities for Xenia Hotels and Perma-Fix Environmental
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Xenia and Perma-Fix is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Xenia Hotels Resorts and Perma Fix Environmental Servic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perma Fix Environmental and Xenia Hotels 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 Xenia Hotels Resorts are associated (or correlated) with Perma-Fix Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perma Fix Environmental has no effect on the direction of Xenia Hotels i.e., Xenia Hotels and Perma-Fix Environmental go up and down completely randomly.
Pair Corralation between Xenia Hotels and Perma-Fix Environmental
Assuming the 90 days trading horizon Xenia Hotels Resorts is expected to generate 0.48 times more return on investment than Perma-Fix Environmental. However, Xenia Hotels Resorts is 2.1 times less risky than Perma-Fix Environmental. It trades about 0.12 of its potential returns per unit of risk. Perma Fix Environmental Services is currently generating about -0.15 per unit of risk. If you would invest 1,450 in Xenia Hotels Resorts on September 15, 2024 and sell it today you would earn a total of 70.00 from holding Xenia Hotels Resorts or generate 4.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xenia Hotels Resorts vs. Perma Fix Environmental Servic
Performance |
| Timeline |
| Xenia Hotels Resorts |
| Perma Fix Environmental |
Xenia Hotels and Perma-Fix Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xenia Hotels and Perma-Fix Environmental
The main advantage of trading using opposite Xenia Hotels and Perma-Fix Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xenia Hotels position performs unexpectedly, Perma-Fix Environmental 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 Perma-Fix Environmental will offset losses from the drop in Perma-Fix Environmental's long position.| Xenia Hotels vs. DICKER DATA LTD | Xenia Hotels vs. Fidelity National Information | Xenia Hotels vs. PUBLIC STORAGE PRFO | Xenia Hotels vs. Siamgas And Petrochemicals |
| Perma-Fix Environmental vs. Xenia Hotels Resorts | Perma-Fix Environmental vs. Webster Financial | Perma-Fix Environmental vs. Sunstone Hotel Investors | Perma-Fix Environmental vs. PT Bank Maybank |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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