Correlation Between DELTA AIR and Summit Hotel
Can any of the company-specific risk be diversified away by investing in both DELTA AIR and Summit 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 DELTA AIR and Summit Hotel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DELTA AIR LINES and Summit Hotel Properties, you can compare the effects of market volatilities on DELTA AIR and Summit 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 DELTA AIR with a short position of Summit Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of DELTA AIR and Summit Hotel.
Diversification Opportunities for DELTA AIR and Summit Hotel
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between DELTA and Summit is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding DELTA AIR LINES and Summit Hotel Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Summit Hotel Properties and DELTA AIR 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 DELTA AIR LINES are associated (or correlated) with Summit Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Summit Hotel Properties has no effect on the direction of DELTA AIR i.e., DELTA AIR and Summit Hotel go up and down completely randomly.
Pair Corralation between DELTA AIR and Summit Hotel
Assuming the 90 days trading horizon DELTA AIR LINES is expected to generate 1.01 times more return on investment than Summit Hotel. However, DELTA AIR is 1.01 times more volatile than Summit Hotel Properties. It trades about 0.08 of its potential returns per unit of risk. Summit Hotel Properties is currently generating about 0.03 per unit of risk. If you would invest 3,288 in DELTA AIR LINES on September 19, 2024 and sell it today you would earn a total of 2,486 from holding DELTA AIR LINES or generate 75.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DELTA AIR LINES vs. Summit Hotel Properties
Performance |
| Timeline |
| DELTA AIR LINES |
| Summit Hotel Properties |
DELTA AIR and Summit Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DELTA AIR and Summit Hotel
The main advantage of trading using opposite DELTA AIR and Summit Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DELTA AIR position performs unexpectedly, Summit 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 Summit Hotel will offset losses from the drop in Summit Hotel's long position.| DELTA AIR vs. Monster Beverage Corp | DELTA AIR vs. JLF INVESTMENT | DELTA AIR vs. Postal Savings Bank | DELTA AIR vs. National Beverage Corp |
| Summit Hotel vs. Host Hotels Resorts | Summit Hotel vs. Sunstone Hotel Investors | Summit Hotel vs. Xenia Hotels Resorts | Summit Hotel vs. ASHFORD HOSPITTRUST |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |