Correlation Between Pebblebrook Hotel and NEXANS
Can any of the company-specific risk be diversified away by investing in both Pebblebrook Hotel and NEXANS 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 NEXANS 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 NEXANS, you can compare the effects of market volatilities on Pebblebrook Hotel and NEXANS 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 NEXANS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pebblebrook Hotel and NEXANS.
Diversification Opportunities for Pebblebrook Hotel and NEXANS
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Pebblebrook and NEXANS is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Pebblebrook Hotel Trust and NEXANS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEXANS 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 NEXANS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEXANS has no effect on the direction of Pebblebrook Hotel i.e., Pebblebrook Hotel and NEXANS go up and down completely randomly.
Pair Corralation between Pebblebrook Hotel and NEXANS
Assuming the 90 days trading horizon Pebblebrook Hotel is expected to generate 4.37 times less return on investment than NEXANS. In addition to that, Pebblebrook Hotel is 1.11 times more volatile than NEXANS. It trades about 0.02 of its total potential returns per unit of risk. NEXANS is currently generating about 0.09 per unit of volatility. If you would invest 6,452 in NEXANS on September 21, 2024 and sell it today you would earn a total of 3,928 from holding NEXANS or generate 60.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pebblebrook Hotel Trust vs. NEXANS
Performance |
| Timeline |
| Pebblebrook Hotel Trust |
| NEXANS |
Pebblebrook Hotel and NEXANS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pebblebrook Hotel and NEXANS
The main advantage of trading using opposite Pebblebrook Hotel and NEXANS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pebblebrook Hotel position performs unexpectedly, NEXANS 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 NEXANS will offset losses from the drop in NEXANS's long position.| Pebblebrook Hotel vs. Apple Inc | Pebblebrook Hotel vs. Apple Inc | Pebblebrook Hotel vs. Apple Inc | Pebblebrook Hotel vs. Apple Inc |
| NEXANS vs. AEGEAN AIRLINES | NEXANS vs. DALATA HOTEL | NEXANS vs. Pebblebrook Hotel Trust | NEXANS vs. Meli Hotels International |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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