Correlation Between Ashford Hospitality and Bridgemarq Real
Can any of the company-specific risk be diversified away by investing in both Ashford Hospitality and Bridgemarq Real 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 Ashford Hospitality and Bridgemarq Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashford Hospitality Trust and Bridgemarq Real Estate, you can compare the effects of market volatilities on Ashford Hospitality and Bridgemarq Real 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 Ashford Hospitality with a short position of Bridgemarq Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashford Hospitality and Bridgemarq Real.
Diversification Opportunities for Ashford Hospitality and Bridgemarq Real
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ashford and Bridgemarq is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Ashford Hospitality Trust and Bridgemarq Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bridgemarq Real Estate and Ashford Hospitality 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 Ashford Hospitality Trust are associated (or correlated) with Bridgemarq Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bridgemarq Real Estate has no effect on the direction of Ashford Hospitality i.e., Ashford Hospitality and Bridgemarq Real go up and down completely randomly.
Pair Corralation between Ashford Hospitality and Bridgemarq Real
Assuming the 90 days trading horizon Ashford Hospitality Trust is expected to generate 2.07 times more return on investment than Bridgemarq Real. However, Ashford Hospitality is 2.07 times more volatile than Bridgemarq Real Estate. It trades about 0.04 of its potential returns per unit of risk. Bridgemarq Real Estate is currently generating about 0.03 per unit of risk. If you would invest 1,148 in Ashford Hospitality Trust on September 12, 2024 and sell it today you would earn a total of 260.00 from holding Ashford Hospitality Trust or generate 22.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 73.94% |
| Values | Daily Returns |
Ashford Hospitality Trust vs. Bridgemarq Real Estate
Performance |
| Timeline |
| Ashford Hospitality Trust |
| Bridgemarq Real Estate |
Ashford Hospitality and Bridgemarq Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashford Hospitality and Bridgemarq Real
The main advantage of trading using opposite Ashford Hospitality and Bridgemarq Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashford Hospitality position performs unexpectedly, Bridgemarq Real 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 Bridgemarq Real will offset losses from the drop in Bridgemarq Real's long position.| Ashford Hospitality vs. Braemar Hotels Resorts | Ashford Hospitality vs. Braemar Hotels Resorts | Ashford Hospitality vs. Ashford Hospitality Trust | Ashford Hospitality vs. Ashford Hospitality Trust |
| Bridgemarq Real vs. Ashford Hospitality Trust | Bridgemarq Real vs. Ashford Hospitality Trust | Bridgemarq Real vs. Braemar Hotels Resorts | Bridgemarq Real vs. Braemar Hotels Resorts |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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