Correlation Between Sunstone Hotel and Santacruz Silver
Can any of the company-specific risk be diversified away by investing in both Sunstone Hotel and Santacruz Silver 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 Santacruz Silver 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 Santacruz Silver Mining, you can compare the effects of market volatilities on Sunstone Hotel and Santacruz Silver 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 Santacruz Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunstone Hotel and Santacruz Silver.
Diversification Opportunities for Sunstone Hotel and Santacruz Silver
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sunstone and Santacruz is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Sunstone Hotel Investors and Santacruz Silver Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Santacruz Silver Mining 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 Santacruz Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Santacruz Silver Mining has no effect on the direction of Sunstone Hotel i.e., Sunstone Hotel and Santacruz Silver go up and down completely randomly.
Pair Corralation between Sunstone Hotel and Santacruz Silver
Assuming the 90 days horizon Sunstone Hotel Investors is expected to generate 0.28 times more return on investment than Santacruz Silver. However, Sunstone Hotel Investors is 3.51 times less risky than Santacruz Silver. It trades about 0.35 of its potential returns per unit of risk. Santacruz Silver Mining is currently generating about 0.07 per unit of risk. If you would invest 965.00 in Sunstone Hotel Investors on September 22, 2024 and sell it today you would earn a total of 195.00 from holding Sunstone Hotel Investors or generate 20.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunstone Hotel Investors vs. Santacruz Silver Mining
Performance |
| Timeline |
| Sunstone Hotel Investors |
| Santacruz Silver Mining |
Sunstone Hotel and Santacruz Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunstone Hotel and Santacruz Silver
The main advantage of trading using opposite Sunstone Hotel and Santacruz Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunstone Hotel position performs unexpectedly, Santacruz Silver 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 Santacruz Silver will offset losses from the drop in Santacruz Silver's long position.| Sunstone Hotel vs. Host Hotels Resorts | Sunstone Hotel vs. Ryman Hospitality Properties | Sunstone Hotel vs. Park Hotels Resorts | Sunstone Hotel vs. Pebblebrook Hotel Trust |
| Santacruz Silver vs. MCEWEN MINING INC | Santacruz Silver vs. ADRIATIC METALS LS 013355 | Santacruz Silver vs. KENNAMETAL INC | Santacruz Silver vs. AAC TECHNOLOGHLDGADR |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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