Correlation Between Mamas Creations and RLJ Lodging
Can any of the company-specific risk be diversified away by investing in both Mamas Creations and RLJ Lodging 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 Mamas Creations and RLJ Lodging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mamas Creations and RLJ Lodging Trust, you can compare the effects of market volatilities on Mamas Creations and RLJ Lodging 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 Mamas Creations with a short position of RLJ Lodging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mamas Creations and RLJ Lodging.
Diversification Opportunities for Mamas Creations and RLJ Lodging
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mamas and RLJ is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Mamas Creations and RLJ Lodging Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RLJ Lodging Trust and Mamas Creations 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 Mamas Creations are associated (or correlated) with RLJ Lodging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RLJ Lodging Trust has no effect on the direction of Mamas Creations i.e., Mamas Creations and RLJ Lodging go up and down completely randomly.
Pair Corralation between Mamas Creations and RLJ Lodging
Given the investment horizon of 90 days Mamas Creations is expected to generate 7.05 times more return on investment than RLJ Lodging. However, Mamas Creations is 7.05 times more volatile than RLJ Lodging Trust. It trades about 0.06 of its potential returns per unit of risk. RLJ Lodging Trust is currently generating about 0.15 per unit of risk. If you would invest 756.00 in Mamas Creations on October 25, 2024 and sell it today you would earn a total of 23.00 from holding Mamas Creations or generate 3.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mamas Creations vs. RLJ Lodging Trust
Performance |
| Timeline |
| Mamas Creations |
| RLJ Lodging Trust |
Mamas Creations and RLJ Lodging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mamas Creations and RLJ Lodging
The main advantage of trading using opposite Mamas Creations and RLJ Lodging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mamas Creations position performs unexpectedly, RLJ Lodging 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 RLJ Lodging will offset losses from the drop in RLJ Lodging's long position.| Mamas Creations vs. Ingredion Incorporated | Mamas Creations vs. Hanover Foods | Mamas Creations vs. BBB Foods | Mamas Creations vs. Harmony Gold Mining |
| RLJ Lodging vs. Diamondrock Hospitality | RLJ Lodging vs. Summit Hotel Properties | RLJ Lodging vs. Pebblebrook Hotel Trust | RLJ Lodging vs. Sunstone Hotel Investors |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |