Correlation Between Summit Hotel and NATIONAL
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By analyzing existing cross correlation between Summit Hotel Properties and NATIONAL RURAL UTILS, you can compare the effects of market volatilities on Summit Hotel and NATIONAL 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 NATIONAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Hotel and NATIONAL.
Diversification Opportunities for Summit Hotel and NATIONAL
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Summit and NATIONAL is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Summit Hotel Properties and NATIONAL RURAL UTILS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NATIONAL RURAL UTILS 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 NATIONAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NATIONAL RURAL UTILS has no effect on the direction of Summit Hotel i.e., Summit Hotel and NATIONAL go up and down completely randomly.
Pair Corralation between Summit Hotel and NATIONAL
Considering the 90-day investment horizon Summit Hotel Properties is expected to generate 2.58 times more return on investment than NATIONAL. However, Summit Hotel is 2.58 times more volatile than NATIONAL RURAL UTILS. It trades about 0.11 of its potential returns per unit of risk. NATIONAL RURAL UTILS is currently generating about -0.21 per unit of risk. If you would invest 620.00 in Summit Hotel Properties on August 28, 2024 and sell it today you would earn a total of 34.00 from holding Summit Hotel Properties or generate 5.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
Summit Hotel Properties vs. NATIONAL RURAL UTILS
Performance |
| Timeline |
| Summit Hotel Properties |
| NATIONAL RURAL UTILS |
Summit Hotel and NATIONAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summit Hotel and NATIONAL
The main advantage of trading using opposite Summit Hotel and NATIONAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Hotel position performs unexpectedly, NATIONAL 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 NATIONAL will offset losses from the drop in NATIONAL's long position.| Summit Hotel vs. Diamondrock Hospitality | Summit Hotel vs. RLJ Lodging Trust | Summit Hotel vs. Pebblebrook Hotel Trust | Summit Hotel vs. Sunstone Hotel Investors |
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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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