Correlation Between Sunstone Hotel and Silvercorp Metals
Can any of the company-specific risk be diversified away by investing in both Sunstone Hotel and Silvercorp Metals 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 Silvercorp Metals 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 Silvercorp Metals, you can compare the effects of market volatilities on Sunstone Hotel and Silvercorp Metals 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 Silvercorp Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunstone Hotel and Silvercorp Metals.
Diversification Opportunities for Sunstone Hotel and Silvercorp Metals
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sunstone and Silvercorp is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Sunstone Hotel Investors and Silvercorp Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silvercorp Metals 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 Silvercorp Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silvercorp Metals has no effect on the direction of Sunstone Hotel i.e., Sunstone Hotel and Silvercorp Metals go up and down completely randomly.
Pair Corralation between Sunstone Hotel and Silvercorp Metals
Assuming the 90 days horizon Sunstone Hotel Investors is expected to generate 1.01 times more return on investment than Silvercorp Metals. However, Sunstone Hotel is 1.01 times more volatile than Silvercorp Metals. It trades about 0.35 of its potential returns per unit of risk. Silvercorp Metals is currently generating about -0.13 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 | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunstone Hotel Investors vs. Silvercorp Metals
Performance |
| Timeline |
| Sunstone Hotel Investors |
| Silvercorp Metals |
Sunstone Hotel and Silvercorp Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunstone Hotel and Silvercorp Metals
The main advantage of trading using opposite Sunstone Hotel and Silvercorp Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunstone Hotel position performs unexpectedly, Silvercorp Metals 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 Silvercorp Metals will offset losses from the drop in Silvercorp Metals' 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 |
| Silvercorp Metals vs. Ares Management Corp | Silvercorp Metals vs. ALTAIR RES INC | Silvercorp Metals vs. Brockhaus Capital Management | Silvercorp Metals vs. Air New Zealand |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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