Correlation Between KINGBOARD CHEMICAL and Pebblebrook Hotel
Can any of the company-specific risk be diversified away by investing in both KINGBOARD CHEMICAL and Pebblebrook Hotel 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 KINGBOARD CHEMICAL and Pebblebrook Hotel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KINGBOARD CHEMICAL and Pebblebrook Hotel Trust, you can compare the effects of market volatilities on KINGBOARD CHEMICAL 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 KINGBOARD CHEMICAL with a short position of Pebblebrook Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of KINGBOARD CHEMICAL and Pebblebrook Hotel.
Diversification Opportunities for KINGBOARD CHEMICAL and Pebblebrook Hotel
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between KINGBOARD and Pebblebrook is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding KINGBOARD CHEMICAL 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 KINGBOARD CHEMICAL 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 KINGBOARD CHEMICAL 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 KINGBOARD CHEMICAL i.e., KINGBOARD CHEMICAL and Pebblebrook Hotel go up and down completely randomly.
Pair Corralation between KINGBOARD CHEMICAL and Pebblebrook Hotel
Assuming the 90 days trading horizon KINGBOARD CHEMICAL is expected to generate 1.7 times more return on investment than Pebblebrook Hotel. However, KINGBOARD CHEMICAL is 1.7 times more volatile than Pebblebrook Hotel Trust. It trades about 0.05 of its potential returns per unit of risk. Pebblebrook Hotel Trust is currently generating about 0.0 per unit of risk. If you would invest 137.00 in KINGBOARD CHEMICAL on October 16, 2024 and sell it today you would earn a total of 103.00 from holding KINGBOARD CHEMICAL or generate 75.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KINGBOARD CHEMICAL vs. Pebblebrook Hotel Trust
Performance |
| Timeline |
| KINGBOARD CHEMICAL |
| Pebblebrook Hotel Trust |
KINGBOARD CHEMICAL and Pebblebrook Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KINGBOARD CHEMICAL and Pebblebrook Hotel
The main advantage of trading using opposite KINGBOARD CHEMICAL and Pebblebrook Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KINGBOARD CHEMICAL 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.| KINGBOARD CHEMICAL vs. IMPERIAL TOBACCO | KINGBOARD CHEMICAL vs. CAIRN HOMES EO | KINGBOARD CHEMICAL vs. CarsalesCom | KINGBOARD CHEMICAL vs. OFFICE DEPOT |
| Pebblebrook Hotel vs. Elmos Semiconductor SE | Pebblebrook Hotel vs. BE Semiconductor Industries | Pebblebrook Hotel vs. KINGBOARD CHEMICAL | Pebblebrook Hotel vs. Siamgas And Petrochemicals |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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