Correlation Between Capital Clean and Summit Hotel
Can any of the company-specific risk be diversified away by investing in both Capital Clean and Summit Hotel 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 Capital Clean and Summit Hotel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital Clean Energy and Summit Hotel Properties, you can compare the effects of market volatilities on Capital Clean and Summit Hotel 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 Capital Clean with a short position of Summit Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Clean and Summit Hotel.
Diversification Opportunities for Capital Clean and Summit Hotel
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Capital and Summit is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Capital Clean Energy and Summit Hotel Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Summit Hotel Properties and Capital Clean 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 Capital Clean Energy are associated (or correlated) with Summit Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Summit Hotel Properties has no effect on the direction of Capital Clean i.e., Capital Clean and Summit Hotel go up and down completely randomly.
Pair Corralation between Capital Clean and Summit Hotel
Given the investment horizon of 90 days Capital Clean is expected to generate 2.28 times less return on investment than Summit Hotel. In addition to that, Capital Clean is 1.15 times more volatile than Summit Hotel Properties. It trades about 0.02 of its total potential returns per unit of risk. Summit Hotel Properties is currently generating about 0.06 per unit of volatility. If you would invest 586.00 in Summit Hotel Properties on September 3, 2024 and sell it today you would earn a total of 71.00 from holding Summit Hotel Properties or generate 12.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capital Clean Energy vs. Summit Hotel Properties
Performance |
| Timeline |
| Capital Clean Energy |
| Summit Hotel Properties |
Capital Clean and Summit Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Clean and Summit Hotel
The main advantage of trading using opposite Capital Clean and Summit Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Clean position performs unexpectedly, Summit Hotel 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 Summit Hotel will offset losses from the drop in Summit Hotel's long position.| Capital Clean vs. Electrovaya Common Shares | Capital Clean vs. Zoom Video Communications | Capital Clean vs. Videolocity International | Capital Clean vs. Hurco Companies |
| Summit Hotel vs. Sotherly Hotels | Summit Hotel vs. Service Properties Trust | Summit Hotel vs. Sunstone Hotel Investors | Summit Hotel vs. Ryman Hospitality Properties |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |