Correlation Between Sunstone Hotel and Check Point
Can any of the company-specific risk be diversified away by investing in both Sunstone Hotel and Check Point 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 Check Point 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 Check Point Software, you can compare the effects of market volatilities on Sunstone Hotel and Check Point 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 Check Point. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunstone Hotel and Check Point.
Diversification Opportunities for Sunstone Hotel and Check Point
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sunstone and Check is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Sunstone Hotel Investors and Check Point Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Check Point Software 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 Check Point. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Check Point Software has no effect on the direction of Sunstone Hotel i.e., Sunstone Hotel and Check Point go up and down completely randomly.
Pair Corralation between Sunstone Hotel and Check Point
Assuming the 90 days horizon Sunstone Hotel Investors is expected to generate 1.39 times more return on investment than Check Point. However, Sunstone Hotel is 1.39 times more volatile than Check Point Software. It trades about 0.18 of its potential returns per unit of risk. Check Point Software is currently generating about 0.24 per unit of risk. If you would invest 925.00 in Sunstone Hotel Investors on September 1, 2024 and sell it today you would earn a total of 75.00 from holding Sunstone Hotel Investors or generate 8.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunstone Hotel Investors vs. Check Point Software
Performance |
| Timeline |
| Sunstone Hotel Investors |
| Check Point Software |
Sunstone Hotel and Check Point Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunstone Hotel and Check Point
The main advantage of trading using opposite Sunstone Hotel and Check Point positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunstone Hotel position performs unexpectedly, Check Point 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 Check Point will offset losses from the drop in Check Point's long position.| Sunstone Hotel vs. Federal Agricultural Mortgage | Sunstone Hotel vs. THAI BEVERAGE | Sunstone Hotel vs. Monster Beverage Corp | Sunstone Hotel vs. Australian Agricultural |
| Check Point vs. SIVERS SEMICONDUCTORS AB | Check Point vs. Darden Restaurants | Check Point vs. Reliance Steel Aluminum | Check Point vs. Q2M Managementberatung AG |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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