Correlation Between BRAEMAR HOTELS and SUN LIFE
Can any of the company-specific risk be diversified away by investing in both BRAEMAR HOTELS and SUN LIFE 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 BRAEMAR HOTELS and SUN LIFE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BRAEMAR HOTELS RES and SUN LIFE FINANCIAL, you can compare the effects of market volatilities on BRAEMAR HOTELS and SUN LIFE 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 BRAEMAR HOTELS with a short position of SUN LIFE. Check out your portfolio center. Please also check ongoing floating volatility patterns of BRAEMAR HOTELS and SUN LIFE.
Diversification Opportunities for BRAEMAR HOTELS and SUN LIFE
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BRAEMAR and SUN is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding BRAEMAR HOTELS RES and SUN LIFE FINANCIAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUN LIFE FINANCIAL and BRAEMAR 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 BRAEMAR HOTELS RES are associated (or correlated) with SUN LIFE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUN LIFE FINANCIAL has no effect on the direction of BRAEMAR HOTELS i.e., BRAEMAR HOTELS and SUN LIFE go up and down completely randomly.
Pair Corralation between BRAEMAR HOTELS and SUN LIFE
Assuming the 90 days horizon BRAEMAR HOTELS RES is expected to under-perform the SUN LIFE. In addition to that, BRAEMAR HOTELS is 6.02 times more volatile than SUN LIFE FINANCIAL. It trades about -0.11 of its total potential returns per unit of risk. SUN LIFE FINANCIAL is currently generating about -0.23 per unit of volatility. If you would invest 5,800 in SUN LIFE FINANCIAL on October 11, 2024 and sell it today you would lose (150.00) from holding SUN LIFE FINANCIAL or give up 2.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BRAEMAR HOTELS RES vs. SUN LIFE FINANCIAL
Performance |
| Timeline |
| BRAEMAR HOTELS RES |
| SUN LIFE FINANCIAL |
BRAEMAR HOTELS and SUN LIFE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BRAEMAR HOTELS and SUN LIFE
The main advantage of trading using opposite BRAEMAR HOTELS and SUN LIFE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BRAEMAR HOTELS position performs unexpectedly, SUN LIFE 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 SUN LIFE will offset losses from the drop in SUN LIFE's long position.| BRAEMAR HOTELS vs. Hua Hong Semiconductor | BRAEMAR HOTELS vs. DEVRY EDUCATION GRP | BRAEMAR HOTELS vs. TAL Education Group | BRAEMAR HOTELS vs. TOREX SEMICONDUCTOR LTD |
| SUN LIFE vs. INTERCONT HOTELS | SUN LIFE vs. PPHE HOTEL GROUP | SUN LIFE vs. BRAEMAR HOTELS RES | SUN LIFE vs. Sunstone Hotel Investors |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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