Correlation Between ADRIATIC METALS and Pebblebrook Hotel
Can any of the company-specific risk be diversified away by investing in both ADRIATIC METALS and Pebblebrook Hotel 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 ADRIATIC METALS and Pebblebrook Hotel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ADRIATIC METALS LS 013355 and Pebblebrook Hotel Trust, you can compare the effects of market volatilities on ADRIATIC METALS and Pebblebrook Hotel 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 ADRIATIC METALS with a short position of Pebblebrook Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of ADRIATIC METALS and Pebblebrook Hotel.
Diversification Opportunities for ADRIATIC METALS and Pebblebrook Hotel
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ADRIATIC and Pebblebrook is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding ADRIATIC METALS LS 013355 and Pebblebrook Hotel Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pebblebrook Hotel Trust and ADRIATIC METALS 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 ADRIATIC METALS LS 013355 are associated (or correlated) with Pebblebrook Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pebblebrook Hotel Trust has no effect on the direction of ADRIATIC METALS i.e., ADRIATIC METALS and Pebblebrook Hotel go up and down completely randomly.
Pair Corralation between ADRIATIC METALS and Pebblebrook Hotel
Assuming the 90 days trading horizon ADRIATIC METALS LS 013355 is expected to generate 1.84 times more return on investment than Pebblebrook Hotel. However, ADRIATIC METALS is 1.84 times more volatile than Pebblebrook Hotel Trust. It trades about 0.08 of its potential returns per unit of risk. Pebblebrook Hotel Trust is currently generating about 0.04 per unit of risk. If you would invest 183.00 in ADRIATIC METALS LS 013355 on October 26, 2024 and sell it today you would earn a total of 61.00 from holding ADRIATIC METALS LS 013355 or generate 33.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
ADRIATIC METALS LS 013355 vs. Pebblebrook Hotel Trust
Performance |
Timeline |
ADRIATIC METALS LS |
Pebblebrook Hotel Trust |
ADRIATIC METALS and Pebblebrook Hotel Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ADRIATIC METALS and Pebblebrook Hotel
The main advantage of trading using opposite ADRIATIC METALS and Pebblebrook Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ADRIATIC METALS position performs unexpectedly, Pebblebrook Hotel 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 Pebblebrook Hotel will offset losses from the drop in Pebblebrook Hotel's long position.ADRIATIC METALS vs. FORWARD AIR P | ADRIATIC METALS vs. Ross Stores | ADRIATIC METALS vs. SEALED AIR | ADRIATIC METALS vs. ALTAIR RES INC |
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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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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