Correlation Between Sunstone Hotel and Qingling Motors
Can any of the company-specific risk be diversified away by investing in both Sunstone Hotel and Qingling Motors 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 Qingling Motors 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 Qingling Motors Co, you can compare the effects of market volatilities on Sunstone Hotel and Qingling Motors 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 Qingling Motors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunstone Hotel and Qingling Motors.
Diversification Opportunities for Sunstone Hotel and Qingling Motors
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sunstone and Qingling is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Sunstone Hotel Investors and Qingling Motors Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qingling Motors 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 Qingling Motors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qingling Motors has no effect on the direction of Sunstone Hotel i.e., Sunstone Hotel and Qingling Motors go up and down completely randomly.
Pair Corralation between Sunstone Hotel and Qingling Motors
Assuming the 90 days horizon Sunstone Hotel Investors is expected to generate 0.41 times more return on investment than Qingling Motors. However, Sunstone Hotel Investors is 2.44 times less risky than Qingling Motors. It trades about 0.05 of its potential returns per unit of risk. Qingling Motors Co is currently generating about 0.0 per unit of risk. If you would invest 885.00 in Sunstone Hotel Investors on October 24, 2024 and sell it today you would earn a total of 235.00 from holding Sunstone Hotel Investors or generate 26.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.75% |
| Values | Daily Returns |
Sunstone Hotel Investors vs. Qingling Motors Co
Performance |
| Timeline |
| Sunstone Hotel Investors |
| Qingling Motors |
Sunstone Hotel and Qingling Motors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunstone Hotel and Qingling Motors
The main advantage of trading using opposite Sunstone Hotel and Qingling Motors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunstone Hotel position performs unexpectedly, Qingling Motors 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 Qingling Motors will offset losses from the drop in Qingling Motors' long position.| Sunstone Hotel vs. OFFICE DEPOT | Sunstone Hotel vs. WillScot Mobile Mini | Sunstone Hotel vs. Entravision Communications | Sunstone Hotel vs. Iridium Communications |
| Qingling Motors vs. AAC TECHNOLOGHLDGADR | Qingling Motors vs. AWILCO DRILLING PLC | Qingling Motors vs. VELA TECHNOLPLC LS 0001 | Qingling Motors vs. Pembina Pipeline Corp |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |