Correlation Between INTERSHOP Communications and Pebblebrook Hotel
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By analyzing existing cross correlation between INTERSHOP Communications Aktiengesellschaft and Pebblebrook Hotel Trust, you can compare the effects of market volatilities on INTERSHOP Communications and Pebblebrook 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 INTERSHOP Communications with a short position of Pebblebrook Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTERSHOP Communications and Pebblebrook Hotel.
Diversification Opportunities for INTERSHOP Communications and Pebblebrook Hotel
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between INTERSHOP and Pebblebrook is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding INTERSHOP Communications Aktie and Pebblebrook Hotel Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pebblebrook Hotel Trust and INTERSHOP Communications 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 INTERSHOP Communications Aktiengesellschaft are associated (or correlated) with Pebblebrook Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pebblebrook Hotel Trust has no effect on the direction of INTERSHOP Communications i.e., INTERSHOP Communications and Pebblebrook Hotel go up and down completely randomly.
Pair Corralation between INTERSHOP Communications and Pebblebrook Hotel
Assuming the 90 days trading horizon INTERSHOP Communications Aktiengesellschaft is expected to generate 1.19 times more return on investment than Pebblebrook Hotel. However, INTERSHOP Communications is 1.19 times more volatile than Pebblebrook Hotel Trust. It trades about -0.16 of its potential returns per unit of risk. Pebblebrook Hotel Trust is currently generating about -0.24 per unit of risk. If you would invest 190.00 in INTERSHOP Communications Aktiengesellschaft on October 11, 2024 and sell it today you would lose (14.00) from holding INTERSHOP Communications Aktiengesellschaft or give up 7.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
INTERSHOP Communications Aktie vs. Pebblebrook Hotel Trust
Performance |
| Timeline |
| INTERSHOP Communications |
| Pebblebrook Hotel Trust |
INTERSHOP Communications and Pebblebrook Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTERSHOP Communications and Pebblebrook Hotel
The main advantage of trading using opposite INTERSHOP Communications and Pebblebrook Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTERSHOP Communications position performs unexpectedly, Pebblebrook 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 Pebblebrook Hotel will offset losses from the drop in Pebblebrook Hotel's long position.The idea behind INTERSHOP Communications Aktiengesellschaft and Pebblebrook Hotel Trust pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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