Correlation Between Ashford Hospitality and Dunham Real
Can any of the company-specific risk be diversified away by investing in both Ashford Hospitality and Dunham 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 Dunham 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 Dunham Real Estate, you can compare the effects of market volatilities on Ashford Hospitality and Dunham 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 Dunham Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashford Hospitality and Dunham Real.
Diversification Opportunities for Ashford Hospitality and Dunham Real
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ashford and DUNHAM is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Ashford Hospitality Trust and Dunham Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham 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 Dunham Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Real Estate has no effect on the direction of Ashford Hospitality i.e., Ashford Hospitality and Dunham Real go up and down completely randomly.
Pair Corralation between Ashford Hospitality and Dunham Real
Considering the 90-day investment horizon Ashford Hospitality Trust is expected to generate 9.76 times more return on investment than Dunham Real. However, Ashford Hospitality is 9.76 times more volatile than Dunham Real Estate. It trades about 0.22 of its potential returns per unit of risk. Dunham Real Estate is currently generating about 0.03 per unit of risk. If you would invest 610.00 in Ashford Hospitality Trust on August 28, 2024 and sell it today you would earn a total of 284.00 from holding Ashford Hospitality Trust or generate 46.56% 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. Dunham Real Estate
Performance |
| Timeline |
| Ashford Hospitality Trust |
| Dunham Real Estate |
Ashford Hospitality and Dunham Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashford Hospitality and Dunham Real
The main advantage of trading using opposite Ashford Hospitality and Dunham Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashford Hospitality position performs unexpectedly, Dunham 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 Dunham Real will offset losses from the drop in Dunham Real'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 |
| Dunham Real vs. Realty Income | Dunham Real vs. Dynex Capital | Dunham Real vs. First Industrial Realty | Dunham Real 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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