Correlation Between DAX Index and Summit Hotel
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By analyzing existing cross correlation between DAX Index and Summit Hotel Properties, you can compare the effects of market volatilities on DAX Index 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 DAX Index with a short position of Summit Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Summit Hotel.
Diversification Opportunities for DAX Index and Summit Hotel
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between DAX and Summit is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index 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 DAX Index 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 DAX Index 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 DAX Index i.e., DAX Index and Summit Hotel go up and down completely randomly.
Pair Corralation between DAX Index and Summit Hotel
Assuming the 90 days trading horizon DAX Index is expected to generate 0.41 times more return on investment than Summit Hotel. However, DAX Index is 2.44 times less risky than Summit Hotel. It trades about 0.09 of its potential returns per unit of risk. Summit Hotel Properties is currently generating about 0.03 per unit of risk. If you would invest 1,640,476 in DAX Index on August 29, 2024 and sell it today you would earn a total of 289,122 from holding DAX Index or generate 17.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Summit Hotel Properties
Performance |
| Timeline |
DAX Index and Summit Hotel Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Summit Hotel Properties
Pair trading matchups for Summit Hotel
Pair Trading with DAX Index and Summit Hotel
The main advantage of trading using opposite DAX Index and Summit Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index 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.| DAX Index vs. Gladstone Investment | DAX Index vs. REINET INVESTMENTS SCA | DAX Index vs. CarsalesCom | DAX Index vs. MARKET VECTR RETAIL |
| Summit Hotel vs. Host Hotels Resorts | Summit Hotel vs. Sunstone Hotel Investors | Summit Hotel vs. Xenia Hotels Resorts | Summit Hotel vs. ASHFORD HOSPITTRUST |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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