Correlation Between Summit Hotel and APACHE
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By analyzing existing cross correlation between Summit Hotel Properties and APACHE P 51, you can compare the effects of market volatilities on Summit Hotel and APACHE 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 APACHE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Hotel and APACHE.
Diversification Opportunities for Summit Hotel and APACHE
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Summit and APACHE is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Summit Hotel Properties and APACHE P 51 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APACHE P 51 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 APACHE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APACHE P 51 has no effect on the direction of Summit Hotel i.e., Summit Hotel and APACHE go up and down completely randomly.
Pair Corralation between Summit Hotel and APACHE
Considering the 90-day investment horizon Summit Hotel Properties is expected to generate 1.37 times more return on investment than APACHE. However, Summit Hotel is 1.37 times more volatile than APACHE P 51. It trades about 0.19 of its potential returns per unit of risk. APACHE P 51 is currently generating about -0.14 per unit of risk. If you would invest 610.00 in Summit Hotel Properties on September 5, 2024 and sell it today you would earn a total of 67.00 from holding Summit Hotel Properties or generate 10.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Summit Hotel Properties vs. APACHE P 51
Performance |
| Timeline |
| Summit Hotel Properties |
| APACHE P 51 |
Summit Hotel and APACHE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summit Hotel and APACHE
The main advantage of trading using opposite Summit Hotel and APACHE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Hotel position performs unexpectedly, APACHE 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 APACHE will offset losses from the drop in APACHE's long position.| Summit Hotel vs. Diamondrock Hospitality | Summit Hotel vs. Ryman Hospitality Properties | Summit Hotel vs. Service Properties Trust |
| APACHE vs. Nomura Holdings ADR | APACHE vs. Summit Hotel Properties | APACHE vs. Shake Shack | APACHE vs. Stepstone Group |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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