Correlation Between Pebblebrook Hotel and Brockhaus Capital
Can any of the company-specific risk be diversified away by investing in both Pebblebrook Hotel and Brockhaus Capital 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 Pebblebrook Hotel and Brockhaus Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pebblebrook Hotel Trust and Brockhaus Capital Management, you can compare the effects of market volatilities on Pebblebrook Hotel and Brockhaus Capital 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 Pebblebrook Hotel with a short position of Brockhaus Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pebblebrook Hotel and Brockhaus Capital.
Diversification Opportunities for Pebblebrook Hotel and Brockhaus Capital
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Pebblebrook and Brockhaus is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Pebblebrook Hotel Trust and Brockhaus Capital Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brockhaus Capital and Pebblebrook 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 Pebblebrook Hotel Trust are associated (or correlated) with Brockhaus Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brockhaus Capital has no effect on the direction of Pebblebrook Hotel i.e., Pebblebrook Hotel and Brockhaus Capital go up and down completely randomly.
Pair Corralation between Pebblebrook Hotel and Brockhaus Capital
Assuming the 90 days trading horizon Pebblebrook Hotel Trust is expected to under-perform the Brockhaus Capital. But the stock apears to be less risky and, when comparing its historical volatility, Pebblebrook Hotel Trust is 1.23 times less risky than Brockhaus Capital. The stock trades about -0.04 of its potential returns per unit of risk. The Brockhaus Capital Management is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest 2,280 in Brockhaus Capital Management on November 5, 2024 and sell it today you would earn a total of 390.00 from holding Brockhaus Capital Management or generate 17.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pebblebrook Hotel Trust vs. Brockhaus Capital Management
Performance |
| Timeline |
| Pebblebrook Hotel Trust |
| Brockhaus Capital |
Pebblebrook Hotel and Brockhaus Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pebblebrook Hotel and Brockhaus Capital
The main advantage of trading using opposite Pebblebrook Hotel and Brockhaus Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pebblebrook Hotel position performs unexpectedly, Brockhaus Capital 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 Brockhaus Capital will offset losses from the drop in Brockhaus Capital's long position.| Pebblebrook Hotel vs. SIVERS SEMICONDUCTORS AB | Pebblebrook Hotel vs. NorAm Drilling AS | Pebblebrook Hotel vs. Volkswagen AG | Pebblebrook Hotel vs. Darden Restaurants |
| Brockhaus Capital vs. Blackstone Group | Brockhaus Capital vs. The Bank of | Brockhaus Capital vs. Ameriprise Financial | Brockhaus Capital vs. State Street |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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