Correlation Between Pebblebrook Hotel and HEXINDO ADIPERKASA
Can any of the company-specific risk be diversified away by investing in both Pebblebrook Hotel and HEXINDO ADIPERKASA 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 HEXINDO ADIPERKASA 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 HEXINDO ADIPERKASA, you can compare the effects of market volatilities on Pebblebrook Hotel and HEXINDO ADIPERKASA 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 HEXINDO ADIPERKASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pebblebrook Hotel and HEXINDO ADIPERKASA.
Diversification Opportunities for Pebblebrook Hotel and HEXINDO ADIPERKASA
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pebblebrook and HEXINDO is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Pebblebrook Hotel Trust and HEXINDO ADIPERKASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HEXINDO ADIPERKASA 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 HEXINDO ADIPERKASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HEXINDO ADIPERKASA has no effect on the direction of Pebblebrook Hotel i.e., Pebblebrook Hotel and HEXINDO ADIPERKASA go up and down completely randomly.
Pair Corralation between Pebblebrook Hotel and HEXINDO ADIPERKASA
Assuming the 90 days trading horizon Pebblebrook Hotel Trust is expected to generate 1.67 times more return on investment than HEXINDO ADIPERKASA. However, Pebblebrook Hotel is 1.67 times more volatile than HEXINDO ADIPERKASA. It trades about 0.28 of its potential returns per unit of risk. HEXINDO ADIPERKASA is currently generating about -0.29 per unit of risk. If you would invest 1,090 in Pebblebrook Hotel Trust on September 4, 2024 and sell it today you would earn a total of 190.00 from holding Pebblebrook Hotel Trust or generate 17.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Pebblebrook Hotel Trust vs. HEXINDO ADIPERKASA
Performance |
| Timeline |
| Pebblebrook Hotel Trust |
| HEXINDO ADIPERKASA |
Pebblebrook Hotel and HEXINDO ADIPERKASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pebblebrook Hotel and HEXINDO ADIPERKASA
The main advantage of trading using opposite Pebblebrook Hotel and HEXINDO ADIPERKASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pebblebrook Hotel position performs unexpectedly, HEXINDO ADIPERKASA 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 HEXINDO ADIPERKASA will offset losses from the drop in HEXINDO ADIPERKASA's long position.| Pebblebrook Hotel vs. CDN IMPERIAL BANK | Pebblebrook Hotel vs. QBE Insurance Group | Pebblebrook Hotel vs. Tower Semiconductor | Pebblebrook Hotel vs. PT Bank Maybank |
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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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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