Correlation Between ATT and DiamondRock Hospitality
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By analyzing existing cross correlation between ATT Inc and DiamondRock Hospitality, you can compare the effects of market volatilities on ATT and DiamondRock Hospitality 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 ATT with a short position of DiamondRock Hospitality. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATT and DiamondRock Hospitality.
Diversification Opportunities for ATT and DiamondRock Hospitality
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between ATT and DiamondRock is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding ATT Inc and DiamondRock Hospitality in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DiamondRock Hospitality and ATT 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 ATT Inc are associated (or correlated) with DiamondRock Hospitality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DiamondRock Hospitality has no effect on the direction of ATT i.e., ATT and DiamondRock Hospitality go up and down completely randomly.
Pair Corralation between ATT and DiamondRock Hospitality
Assuming the 90 days trading horizon ATT Inc is expected to generate 0.4 times more return on investment than DiamondRock Hospitality. However, ATT Inc is 2.48 times less risky than DiamondRock Hospitality. It trades about 0.06 of its potential returns per unit of risk. DiamondRock Hospitality is currently generating about 0.02 per unit of risk. If you would invest 1,558 in ATT Inc on November 5, 2024 and sell it today you would earn a total of 749.00 from holding ATT Inc or generate 48.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ATT Inc vs. DiamondRock Hospitality
Performance |
| Timeline |
| ATT Inc |
| DiamondRock Hospitality |
ATT and DiamondRock Hospitality Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATT and DiamondRock Hospitality
The main advantage of trading using opposite ATT and DiamondRock Hospitality positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATT position performs unexpectedly, DiamondRock Hospitality 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 DiamondRock Hospitality will offset losses from the drop in DiamondRock Hospitality's long position.| ATT vs. Gladstone Investment | ATT vs. PennyMac Mortgage Investment | ATT vs. CHRYSALIS INVESTMENTS LTD | ATT vs. UNIVMUSIC GRPADR050 |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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