Correlation Between Braemar Hotels and Artis REIT
Can any of the company-specific risk be diversified away by investing in both Braemar Hotels and Artis REIT 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 Braemar Hotels and Artis REIT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Braemar Hotels Resorts and Artis REIT, you can compare the effects of market volatilities on Braemar Hotels and Artis REIT 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 Braemar Hotels with a short position of Artis REIT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Braemar Hotels and Artis REIT.
Diversification Opportunities for Braemar Hotels and Artis REIT
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Braemar and Artis is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Braemar Hotels Resorts and Artis REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artis REIT and Braemar Hotels 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 Braemar Hotels Resorts are associated (or correlated) with Artis REIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artis REIT has no effect on the direction of Braemar Hotels i.e., Braemar Hotels and Artis REIT go up and down completely randomly.
Pair Corralation between Braemar Hotels and Artis REIT
Assuming the 90 days trading horizon Braemar Hotels Resorts is expected to under-perform the Artis REIT. In addition to that, Braemar Hotels is 1.4 times more volatile than Artis REIT. It trades about -0.29 of its total potential returns per unit of risk. Artis REIT is currently generating about -0.39 per unit of volatility. If you would invest 565.00 in Artis REIT on September 15, 2024 and sell it today you would lose (49.00) from holding Artis REIT or give up 8.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Braemar Hotels Resorts vs. Artis REIT
Performance |
| Timeline |
| Braemar Hotels Resorts |
| Artis REIT |
Braemar Hotels and Artis REIT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Braemar Hotels and Artis REIT
The main advantage of trading using opposite Braemar Hotels and Artis REIT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Braemar Hotels position performs unexpectedly, Artis REIT 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 Artis REIT will offset losses from the drop in Artis REIT's long position.| Braemar Hotels vs. Ashford Hospitality Trust | Braemar Hotels vs. Ashford Hospitality Trust | Braemar Hotels vs. Braemar Hotels Resorts | Braemar Hotels vs. Ashford Hospitality Trust |
| Artis REIT vs. Ashford Hospitality Trust | Artis REIT vs. Ashford Hospitality Trust | Artis REIT vs. Braemar Hotels Resorts | Artis REIT vs. Braemar Hotels Resorts |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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