Correlation Between Summit Hotel and Neogen
Can any of the company-specific risk be diversified away by investing in both Summit Hotel and Neogen 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 Neogen 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 Neogen, you can compare the effects of market volatilities on Summit Hotel and Neogen 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 Neogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Hotel and Neogen.
Diversification Opportunities for Summit Hotel and Neogen
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Summit and Neogen is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Summit Hotel Properties and Neogen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neogen 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 Neogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neogen has no effect on the direction of Summit Hotel i.e., Summit Hotel and Neogen go up and down completely randomly.
Pair Corralation between Summit Hotel and Neogen
Considering the 90-day investment horizon Summit Hotel Properties is expected to generate 0.74 times more return on investment than Neogen. However, Summit Hotel Properties is 1.36 times less risky than Neogen. It trades about 0.01 of its potential returns per unit of risk. Neogen is currently generating about -0.01 per unit of risk. If you would invest 666.00 in Summit Hotel Properties on August 31, 2024 and sell it today you would lose (8.00) from holding Summit Hotel Properties or give up 1.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Summit Hotel Properties vs. Neogen
Performance |
| Timeline |
| Summit Hotel Properties |
| Neogen |
Summit Hotel and Neogen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summit Hotel and Neogen
The main advantage of trading using opposite Summit Hotel and Neogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Hotel position performs unexpectedly, Neogen 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 Neogen will offset losses from the drop in Neogen's long position.| Summit Hotel vs. Sunstone Hotel Investors | Summit Hotel vs. Pebblebrook Hotel Trust | Summit Hotel vs. Ryman Hospitality Properties | Summit Hotel vs. Xenia Hotels Resorts |
| Neogen vs. Qiagen NV | Neogen vs. Aclaris Therapeutics | Neogen vs. IQVIA Holdings | Neogen vs. Medpace Holdings |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Commodity Directory Find actively traded commodities issued by global exchanges |