Correlation Between Armada Hflr and Sunstone Hotel
Can any of the company-specific risk be diversified away by investing in both Armada Hflr and Sunstone 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 Armada Hflr and Sunstone Hotel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Armada Hflr Pr and Sunstone Hotel Investors, you can compare the effects of market volatilities on Armada Hflr and Sunstone 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 Armada Hflr with a short position of Sunstone Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and Sunstone Hotel.
Diversification Opportunities for Armada Hflr and Sunstone Hotel
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Armada and Sunstone is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and Sunstone Hotel Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunstone Hotel Investors and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with Sunstone Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunstone Hotel Investors has no effect on the direction of Armada Hflr i.e., Armada Hflr and Sunstone Hotel go up and down completely randomly.
Pair Corralation between Armada Hflr and Sunstone Hotel
Considering the 90-day investment horizon Armada Hflr Pr is expected to under-perform the Sunstone Hotel. In addition to that, Armada Hflr is 1.44 times more volatile than Sunstone Hotel Investors. It trades about -0.1 of its total potential returns per unit of risk. Sunstone Hotel Investors is currently generating about -0.05 per unit of volatility. If you would invest 1,165 in Sunstone Hotel Investors on November 2, 2024 and sell it today you would lose (16.00) from holding Sunstone Hotel Investors or give up 1.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Armada Hflr Pr vs. Sunstone Hotel Investors
Performance |
| Timeline |
| Armada Hflr Pr |
| Sunstone Hotel Investors |
Armada Hflr and Sunstone Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Armada Hflr and Sunstone Hotel
The main advantage of trading using opposite Armada Hflr and Sunstone Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Armada Hflr position performs unexpectedly, Sunstone 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 Sunstone Hotel will offset losses from the drop in Sunstone Hotel's long position.| Armada Hflr vs. Modiv Inc | Armada Hflr vs. Precinct Properties New | Armada Hflr vs. Global Net Lease | Armada Hflr vs. NexPoint Diversified Real |
| Sunstone Hotel vs. RLJ Lodging Trust | Sunstone Hotel vs. Pebblebrook Hotel Trust | Sunstone Hotel vs. Summit Hotel Properties | Sunstone Hotel vs. Ryman Hospitality Properties |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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