Correlation Between Ashford Hospitality and Artis REIT
Can any of the company-specific risk be diversified away by investing in both Ashford Hospitality and Artis REIT 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 Artis REIT 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 Artis REIT, you can compare the effects of market volatilities on Ashford Hospitality and Artis REIT 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 Artis REIT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashford Hospitality and Artis REIT.
Diversification Opportunities for Ashford Hospitality and Artis REIT
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ashford and Artis is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Ashford Hospitality Trust and Artis REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artis REIT 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 Artis REIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artis REIT has no effect on the direction of Ashford Hospitality i.e., Ashford Hospitality and Artis REIT go up and down completely randomly.
Pair Corralation between Ashford Hospitality and Artis REIT
Assuming the 90 days trading horizon Ashford Hospitality Trust is expected to generate 1.77 times more return on investment than Artis REIT. However, Ashford Hospitality is 1.77 times more volatile than Artis REIT. It trades about -0.07 of its potential returns per unit of risk. Artis REIT is currently generating about -0.39 per unit of risk. If you would invest 1,507 in Ashford Hospitality Trust on September 15, 2024 and sell it today you would lose (50.00) from holding Ashford Hospitality Trust or give up 3.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashford Hospitality Trust vs. Artis REIT
Performance |
| Timeline |
| Ashford Hospitality Trust |
| Artis REIT |
Ashford Hospitality and Artis REIT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashford Hospitality and Artis REIT
The main advantage of trading using opposite Ashford Hospitality and Artis REIT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashford Hospitality position performs unexpectedly, Artis REIT 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 Artis REIT will offset losses from the drop in Artis REIT's long position.| Ashford Hospitality vs. Ashford Hospitality Trust | Ashford Hospitality vs. Braemar Hotels Resorts | Ashford Hospitality vs. Braemar Hotels Resorts | Ashford Hospitality vs. Ashford Hospitality Trust |
| Artis REIT vs. Ashford Hospitality Trust | Artis REIT vs. Ashford Hospitality Trust | Artis REIT vs. Braemar Hotels Resorts | Artis REIT 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 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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