Correlation Between Ashford Hospitality and Baron Real
Can any of the company-specific risk be diversified away by investing in both Ashford Hospitality and Baron 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 Baron 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 Baron Real Estate, you can compare the effects of market volatilities on Ashford Hospitality and Baron 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 Baron Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashford Hospitality and Baron Real.
Diversification Opportunities for Ashford Hospitality and Baron Real
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ashford and Baron is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Ashford Hospitality Trust and Baron Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baron 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 Baron Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baron Real Estate has no effect on the direction of Ashford Hospitality i.e., Ashford Hospitality and Baron Real go up and down completely randomly.
Pair Corralation between Ashford Hospitality and Baron Real
Assuming the 90 days trading horizon Ashford Hospitality Trust is expected to under-perform the Baron Real. In addition to that, Ashford Hospitality is 2.74 times more volatile than Baron Real Estate. It trades about -0.03 of its total potential returns per unit of risk. Baron Real Estate is currently generating about 0.17 per unit of volatility. If you would invest 1,687 in Baron Real Estate on August 31, 2024 and sell it today you would earn a total of 66.00 from holding Baron Real Estate or generate 3.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashford Hospitality Trust vs. Baron Real Estate
Performance |
| Timeline |
| Ashford Hospitality Trust |
| Baron Real Estate |
Ashford Hospitality and Baron Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashford Hospitality and Baron Real
The main advantage of trading using opposite Ashford Hospitality and Baron Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashford Hospitality position performs unexpectedly, Baron 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 Baron Real will offset losses from the drop in Baron Real'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 |
| Baron Real vs. Franklin High Income | Baron Real vs. Pioneer High Yield | Baron Real vs. Aquila Three Peaks | Baron Real vs. California High Yield Municipal |
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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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