Correlation Between Summit Hotel and MOVIE GAMES
Can any of the company-specific risk be diversified away by investing in both Summit Hotel and MOVIE GAMES 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 Summit Hotel and MOVIE GAMES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summit Hotel Properties and MOVIE GAMES SA, you can compare the effects of market volatilities on Summit Hotel and MOVIE GAMES 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 Summit Hotel with a short position of MOVIE GAMES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Hotel and MOVIE GAMES.
Diversification Opportunities for Summit Hotel and MOVIE GAMES
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Summit and MOVIE is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Summit Hotel Properties and MOVIE GAMES SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MOVIE GAMES SA and Summit 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 Summit Hotel Properties are associated (or correlated) with MOVIE GAMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MOVIE GAMES SA has no effect on the direction of Summit Hotel i.e., Summit Hotel and MOVIE GAMES go up and down completely randomly.
Pair Corralation between Summit Hotel and MOVIE GAMES
Assuming the 90 days horizon Summit Hotel Properties is expected to generate 1.13 times more return on investment than MOVIE GAMES. However, Summit Hotel is 1.13 times more volatile than MOVIE GAMES SA. It trades about 0.18 of its potential returns per unit of risk. MOVIE GAMES SA is currently generating about -0.44 per unit of risk. If you would invest 587.00 in Summit Hotel Properties on September 15, 2024 and sell it today you would earn a total of 48.00 from holding Summit Hotel Properties or generate 8.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Summit Hotel Properties vs. MOVIE GAMES SA
Performance |
| Timeline |
| Summit Hotel Properties |
| MOVIE GAMES SA |
Summit Hotel and MOVIE GAMES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summit Hotel and MOVIE GAMES
The main advantage of trading using opposite Summit Hotel and MOVIE GAMES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Hotel position performs unexpectedly, MOVIE GAMES 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 MOVIE GAMES will offset losses from the drop in MOVIE GAMES's long position.| Summit Hotel vs. Host Hotels Resorts | Summit Hotel vs. Sunstone Hotel Investors | Summit Hotel vs. Xenia Hotels Resorts | Summit Hotel vs. ASHFORD HOSPITTRUST |
| MOVIE GAMES vs. MELIA HOTELS | MOVIE GAMES vs. PPHE HOTEL GROUP | MOVIE GAMES vs. Summit Hotel Properties | MOVIE GAMES vs. Fast Retailing Co |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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