Correlation Between Ashford Hospitality and Pebblebrook Hotel
Can any of the company-specific risk be diversified away by investing in both Ashford Hospitality and Pebblebrook 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 Ashford Hospitality and Pebblebrook Hotel 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 Pebblebrook Hotel Trust, you can compare the effects of market volatilities on Ashford Hospitality and Pebblebrook 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 Ashford Hospitality with a short position of Pebblebrook Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashford Hospitality and Pebblebrook Hotel.
Diversification Opportunities for Ashford Hospitality and Pebblebrook Hotel
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ashford and Pebblebrook is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Ashford Hospitality Trust and Pebblebrook Hotel Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pebblebrook Hotel Trust 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 Pebblebrook Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pebblebrook Hotel Trust has no effect on the direction of Ashford Hospitality i.e., Ashford Hospitality and Pebblebrook Hotel go up and down completely randomly.
Pair Corralation between Ashford Hospitality and Pebblebrook Hotel
Assuming the 90 days trading horizon Ashford Hospitality Trust is expected to under-perform the Pebblebrook Hotel. In addition to that, Ashford Hospitality is 3.74 times more volatile than Pebblebrook Hotel Trust. It trades about -0.06 of its total potential returns per unit of risk. Pebblebrook Hotel Trust is currently generating about -0.01 per unit of volatility. If you would invest 2,198 in Pebblebrook Hotel Trust on September 2, 2024 and sell it today you would lose (13.00) from holding Pebblebrook Hotel Trust or give up 0.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashford Hospitality Trust vs. Pebblebrook Hotel Trust
Performance |
| Timeline |
| Ashford Hospitality Trust |
| Pebblebrook Hotel Trust |
Ashford Hospitality and Pebblebrook Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashford Hospitality and Pebblebrook Hotel
The main advantage of trading using opposite Ashford Hospitality and Pebblebrook Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashford Hospitality position performs unexpectedly, Pebblebrook 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 Pebblebrook Hotel will offset losses from the drop in Pebblebrook Hotel's long position.| Ashford Hospitality vs. Braemar Hotels Resorts | Ashford Hospitality vs. Braemar Hotels Resorts | Ashford Hospitality vs. Aspen Digital |
| Pebblebrook Hotel vs. Braemar Hotels Resorts | Pebblebrook Hotel vs. Braemar Hotels Resorts | Pebblebrook Hotel vs. Aspen Digital |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |