Correlation Between Sunstone Hotel and Warehouses
Can any of the company-specific risk be diversified away by investing in both Sunstone Hotel and Warehouses 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 Warehouses 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 Warehouses De Pauw, you can compare the effects of market volatilities on Sunstone Hotel and Warehouses 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 Warehouses. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunstone Hotel and Warehouses.
Diversification Opportunities for Sunstone Hotel and Warehouses
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sunstone and Warehouses is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Sunstone Hotel Investors and Warehouses De Pauw in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Warehouses De Pauw 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 Warehouses. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Warehouses De Pauw has no effect on the direction of Sunstone Hotel i.e., Sunstone Hotel and Warehouses go up and down completely randomly.
Pair Corralation between Sunstone Hotel and Warehouses
Assuming the 90 days horizon Sunstone Hotel Investors is expected to generate 1.07 times more return on investment than Warehouses. However, Sunstone Hotel is 1.07 times more volatile than Warehouses De Pauw. It trades about 0.01 of its potential returns per unit of risk. Warehouses De Pauw is currently generating about -0.03 per unit of risk. If you would invest 986.00 in Sunstone Hotel Investors on December 4, 2024 and sell it today you would earn a total of 14.00 from holding Sunstone Hotel Investors or generate 1.42% 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. Warehouses De Pauw
Performance |
| Timeline |
| Sunstone Hotel Investors |
| Warehouses De Pauw |
Sunstone Hotel and Warehouses Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunstone Hotel and Warehouses
The main advantage of trading using opposite Sunstone Hotel and Warehouses positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunstone Hotel position performs unexpectedly, Warehouses 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 Warehouses will offset losses from the drop in Warehouses' long position.| Sunstone Hotel vs. AWILCO DRILLING PLC | Sunstone Hotel vs. United Airlines Holdings | Sunstone Hotel vs. JAPAN AIRLINES | Sunstone Hotel vs. PT Steel Pipe |
| Warehouses vs. Extra Space Storage | Warehouses vs. REXFORD INDREALTY DL 01 | Warehouses vs. CubeSmart | Warehouses vs. First Industrial Realty |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Positions Ratings 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 | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |