Correlation Between Slate Grocery and Ashford Hospitality
Can any of the company-specific risk be diversified away by investing in both Slate Grocery and Ashford Hospitality 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 Slate Grocery and Ashford Hospitality into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Slate Grocery REIT and Ashford Hospitality Trust, you can compare the effects of market volatilities on Slate Grocery and Ashford 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 Slate Grocery with a short position of Ashford Hospitality. Check out your portfolio center. Please also check ongoing floating volatility patterns of Slate Grocery and Ashford Hospitality.
Diversification Opportunities for Slate Grocery and Ashford Hospitality
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Slate and Ashford is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Slate Grocery REIT and Ashford Hospitality Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashford Hospitality Trust and Slate Grocery 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 Slate Grocery REIT are associated (or correlated) with Ashford Hospitality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashford Hospitality Trust has no effect on the direction of Slate Grocery i.e., Slate Grocery and Ashford Hospitality go up and down completely randomly.
Pair Corralation between Slate Grocery and Ashford Hospitality
Assuming the 90 days horizon Slate Grocery REIT is expected to generate 0.47 times more return on investment than Ashford Hospitality. However, Slate Grocery REIT is 2.12 times less risky than Ashford Hospitality. It trades about 0.18 of its potential returns per unit of risk. Ashford Hospitality Trust is currently generating about 0.06 per unit of risk. If you would invest 796.00 in Slate Grocery REIT on September 3, 2024 and sell it today you would earn a total of 270.00 from holding Slate Grocery REIT or generate 33.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Slate Grocery REIT vs. Ashford Hospitality Trust
Performance |
| Timeline |
| Slate Grocery REIT |
| Ashford Hospitality Trust |
Slate Grocery and Ashford Hospitality Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Slate Grocery and Ashford Hospitality
The main advantage of trading using opposite Slate Grocery and Ashford Hospitality positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Slate Grocery position performs unexpectedly, Ashford 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 Ashford Hospitality will offset losses from the drop in Ashford Hospitality's long position.| Slate Grocery vs. Ashford Hospitality Trust | Slate Grocery vs. Ashford Hospitality Trust | Slate Grocery vs. Ashford Hospitality Trust | Slate Grocery vs. Ashford Hospitality Trust |
| Ashford Hospitality vs. Ashford Hospitality Trust | Ashford Hospitality vs. Braemar Hotels Resorts | Ashford Hospitality vs. Braemar Hotels Resorts | Ashford Hospitality vs. Ashford Hospitality Trust |
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 Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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