Correlation Between Ashford Hospitality and Global Medical
Can any of the company-specific risk be diversified away by investing in both Ashford Hospitality and Global Medical 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 Global Medical 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 Global Medical REIT, you can compare the effects of market volatilities on Ashford Hospitality and Global Medical 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 Global Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashford Hospitality and Global Medical.
Diversification Opportunities for Ashford Hospitality and Global Medical
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ashford and Global is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Ashford Hospitality Trust and Global Medical REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Medical 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 Global Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Medical REIT has no effect on the direction of Ashford Hospitality i.e., Ashford Hospitality and Global Medical go up and down completely randomly.
Pair Corralation between Ashford Hospitality and Global Medical
Assuming the 90 days trading horizon Ashford Hospitality Trust is expected to generate 4.74 times more return on investment than Global Medical. However, Ashford Hospitality is 4.74 times more volatile than Global Medical REIT. It trades about 0.02 of its potential returns per unit of risk. Global Medical REIT is currently generating about 0.05 per unit of risk. If you would invest 1,310 in Ashford Hospitality Trust on August 28, 2024 and sell it today you would earn a total of 184.00 from holding Ashford Hospitality Trust or generate 14.05% 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. Global Medical REIT
Performance |
| Timeline |
| Ashford Hospitality Trust |
| Global Medical REIT |
Ashford Hospitality and Global Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashford Hospitality and Global Medical
The main advantage of trading using opposite Ashford Hospitality and Global Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashford Hospitality position performs unexpectedly, Global Medical 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 Global Medical will offset losses from the drop in Global Medical's long position.| Ashford Hospitality vs. Braemar Hotels Resorts | Ashford Hospitality vs. Braemar Hotels Resorts | Ashford Hospitality vs. Aspen Digital | Ashford Hospitality vs. Sunstone Hotel Investors |
| Global Medical vs. Global Medical REIT | Global Medical vs. Community Healthcare Trust | Global Medical vs. National Health Investors | Global Medical vs. Healthcare Realty Trust |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |