Correlation Between Ashford Hospitality and Astra Agro
Can any of the company-specific risk be diversified away by investing in both Ashford Hospitality and Astra Agro 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 Astra Agro 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 Astra Agro Lestari, you can compare the effects of market volatilities on Ashford Hospitality and Astra Agro 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 Astra Agro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashford Hospitality and Astra Agro.
Diversification Opportunities for Ashford Hospitality and Astra Agro
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ashford and Astra is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Ashford Hospitality Trust and Astra Agro Lestari in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astra Agro Lestari 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 Astra Agro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astra Agro Lestari has no effect on the direction of Ashford Hospitality i.e., Ashford Hospitality and Astra Agro go up and down completely randomly.
Pair Corralation between Ashford Hospitality and Astra Agro
If you would invest 782.00 in Ashford Hospitality Trust on October 26, 2024 and sell it today you would earn a total of 66.00 from holding Ashford Hospitality Trust or generate 8.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 5.26% |
| Values | Daily Returns |
Ashford Hospitality Trust vs. Astra Agro Lestari
Performance |
| Timeline |
| Ashford Hospitality Trust |
| Astra Agro Lestari |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ashford Hospitality and Astra Agro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashford Hospitality and Astra Agro
The main advantage of trading using opposite Ashford Hospitality and Astra Agro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashford Hospitality position performs unexpectedly, Astra Agro 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 Astra Agro will offset losses from the drop in Astra Agro's long position.| Ashford Hospitality vs. Sotherly Hotels | Ashford Hospitality vs. Summit Hotel Properties | Ashford Hospitality vs. Diamondrock Hospitality | Ashford Hospitality vs. RLJ Lodging Trust |
| Astra Agro vs. Forafric Global PLC | Astra Agro vs. Forafric Global PLC | Astra Agro vs. Australian Agricultural | Astra Agro vs. Limoneira Co |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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