Correlation Between Ashford Hospitality and Wheeler Real
Can any of the company-specific risk be diversified away by investing in both Ashford Hospitality and Wheeler 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 Wheeler 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 Wheeler Real Estate, you can compare the effects of market volatilities on Ashford Hospitality and Wheeler 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 Wheeler Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashford Hospitality and Wheeler Real.
Diversification Opportunities for Ashford Hospitality and Wheeler Real
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ashford and Wheeler is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Ashford Hospitality Trust and Wheeler Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wheeler 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 Wheeler Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wheeler Real Estate has no effect on the direction of Ashford Hospitality i.e., Ashford Hospitality and Wheeler Real go up and down completely randomly.
Pair Corralation between Ashford Hospitality and Wheeler Real
Assuming the 90 days trading horizon Ashford Hospitality Trust is expected to generate 0.82 times more return on investment than Wheeler Real. However, Ashford Hospitality Trust is 1.22 times less risky than Wheeler Real. It trades about -0.08 of its potential returns per unit of risk. Wheeler Real Estate is currently generating about -0.17 per unit of risk. If you would invest 1,507 in Ashford Hospitality Trust on September 1, 2024 and sell it today you would lose (86.00) from holding Ashford Hospitality Trust or give up 5.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ashford Hospitality Trust vs. Wheeler Real Estate
Performance |
| Timeline |
| Ashford Hospitality Trust |
| Wheeler Real Estate |
Ashford Hospitality and Wheeler Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashford Hospitality and Wheeler Real
The main advantage of trading using opposite Ashford Hospitality and Wheeler Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashford Hospitality position performs unexpectedly, Wheeler 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 Wheeler Real will offset losses from the drop in Wheeler 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 |
| Wheeler Real vs. Wheeler Real Estate | Wheeler Real vs. Site Centers Corp | Wheeler Real vs. CBL Associates Properties | Wheeler Real vs. Brixmor Property |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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