Correlation Between Sunstone Hotel and Park Hotels
Can any of the company-specific risk be diversified away by investing in both Sunstone Hotel and Park Hotels 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 Sunstone Hotel and Park Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sunstone Hotel Investors and Park Hotels Resorts, you can compare the effects of market volatilities on Sunstone Hotel and Park Hotels 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 Sunstone Hotel with a short position of Park Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunstone Hotel and Park Hotels.
Diversification Opportunities for Sunstone Hotel and Park Hotels
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sunstone and Park is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Sunstone Hotel Investors and Park Hotels Resorts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Park Hotels Resorts and Sunstone 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 Sunstone Hotel Investors are associated (or correlated) with Park Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Park Hotels Resorts has no effect on the direction of Sunstone Hotel i.e., Sunstone Hotel and Park Hotels go up and down completely randomly.
Pair Corralation between Sunstone Hotel and Park Hotels
Considering the 90-day investment horizon Sunstone Hotel Investors is expected to under-perform the Park Hotels. But the stock apears to be less risky and, when comparing its historical volatility, Sunstone Hotel Investors is 1.03 times less risky than Park Hotels. The stock trades about -0.1 of its potential returns per unit of risk. The Park Hotels Resorts is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 1,378 in Park Hotels Resorts on November 2, 2024 and sell it today you would lose (29.00) from holding Park Hotels Resorts or give up 2.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunstone Hotel Investors vs. Park Hotels Resorts
Performance |
| Timeline |
| Sunstone Hotel Investors |
| Park Hotels Resorts |
Sunstone Hotel and Park Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunstone Hotel and Park Hotels
The main advantage of trading using opposite Sunstone Hotel and Park Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunstone Hotel position performs unexpectedly, Park Hotels 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 Park Hotels will offset losses from the drop in Park Hotels' long position.| Sunstone Hotel vs. RLJ Lodging Trust | Sunstone Hotel vs. Pebblebrook Hotel Trust | Sunstone Hotel vs. Summit Hotel Properties | Sunstone Hotel vs. Ryman Hospitality Properties |
| Park Hotels vs. Diamondrock Hospitality | Park Hotels vs. Ryman Hospitality Properties | Park Hotels vs. Pebblebrook Hotel Trust | Park Hotels vs. Sunstone Hotel Investors |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |