Correlation Between Sunstone Hotel and Associated British
Can any of the company-specific risk be diversified away by investing in both Sunstone Hotel and Associated British 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 Associated British 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 Associated British Foods, you can compare the effects of market volatilities on Sunstone Hotel and Associated British 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 Associated British. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunstone Hotel and Associated British.
Diversification Opportunities for Sunstone Hotel and Associated British
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sunstone and Associated is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sunstone Hotel Investors and Associated British Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Associated British Foods 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 Associated British. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Associated British Foods has no effect on the direction of Sunstone Hotel i.e., Sunstone Hotel and Associated British go up and down completely randomly.
Pair Corralation between Sunstone Hotel and Associated British
If you would invest 985.00 in Sunstone Hotel Investors on September 13, 2024 and sell it today you would earn a total of 175.00 from holding Sunstone Hotel Investors or generate 17.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Sunstone Hotel Investors vs. Associated British Foods
Performance |
| Timeline |
| Sunstone Hotel Investors |
| Associated British Foods |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Sunstone Hotel and Associated British Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunstone Hotel and Associated British
The main advantage of trading using opposite Sunstone Hotel and Associated British positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunstone Hotel position performs unexpectedly, Associated British 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 Associated British will offset losses from the drop in Associated British's long position.| Sunstone Hotel vs. Host Hotels Resorts | Sunstone Hotel vs. Xenia Hotels Resorts | Sunstone Hotel vs. Summit Hotel Properties | Sunstone Hotel vs. ASHFORD HOSPITTRUST |
| Associated British vs. PROSIEBENSAT1 MEDIADR4 | Associated British vs. WisdomTree Investments | Associated British vs. New Residential Investment | Associated British vs. Gladstone Investment |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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