Correlation Between Summit Hotel and PhenomeX
Can any of the company-specific risk be diversified away by investing in both Summit Hotel and PhenomeX 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 Summit Hotel and PhenomeX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summit Hotel Properties and PhenomeX, you can compare the effects of market volatilities on Summit Hotel and PhenomeX 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 Summit Hotel with a short position of PhenomeX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Hotel and PhenomeX.
Diversification Opportunities for Summit Hotel and PhenomeX
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Summit and PhenomeX is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Summit Hotel Properties and PhenomeX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PhenomeX and Summit Hotel 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 Summit Hotel Properties are associated (or correlated) with PhenomeX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PhenomeX has no effect on the direction of Summit Hotel i.e., Summit Hotel and PhenomeX go up and down completely randomly.
Pair Corralation between Summit Hotel and PhenomeX
If you would invest 643.00 in Summit Hotel Properties on September 13, 2024 and sell it today you would earn a total of 46.00 from holding Summit Hotel Properties or generate 7.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Summit Hotel Properties vs. PhenomeX
Performance |
| Timeline |
| Summit Hotel Properties |
| PhenomeX |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Summit Hotel and PhenomeX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summit Hotel and PhenomeX
The main advantage of trading using opposite Summit Hotel and PhenomeX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Hotel position performs unexpectedly, PhenomeX 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 PhenomeX will offset losses from the drop in PhenomeX's long position.| Summit Hotel vs. Park Hotels Resorts | Summit Hotel vs. Diamondrock Hospitality | Summit Hotel vs. Ryman Hospitality Properties | Summit Hotel vs. Pebblebrook Hotel Trust |
| PhenomeX vs. Summit Hotel Properties | PhenomeX vs. Flexible Solutions International | PhenomeX vs. Small Cap Premium | PhenomeX vs. Bluerock Homes 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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