Correlation Between Vastned Retail and Sunstone Hotel
Can any of the company-specific risk be diversified away by investing in both Vastned Retail and Sunstone Hotel 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 Vastned Retail and Sunstone Hotel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vastned Retail NV and Sunstone Hotel Investors, you can compare the effects of market volatilities on Vastned Retail and Sunstone Hotel 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 Vastned Retail with a short position of Sunstone Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vastned Retail and Sunstone Hotel.
Diversification Opportunities for Vastned Retail and Sunstone Hotel
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Vastned and Sunstone is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Vastned Retail NV and Sunstone Hotel Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunstone Hotel Investors and Vastned Retail 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 Vastned Retail NV are associated (or correlated) with Sunstone Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunstone Hotel Investors has no effect on the direction of Vastned Retail i.e., Vastned Retail and Sunstone Hotel go up and down completely randomly.
Pair Corralation between Vastned Retail and Sunstone Hotel
Assuming the 90 days horizon Vastned Retail NV is expected to under-perform the Sunstone Hotel. But the stock apears to be less risky and, when comparing its historical volatility, Vastned Retail NV is 2.1 times less risky than Sunstone Hotel. The stock trades about -0.02 of its potential returns per unit of risk. The Sunstone Hotel Investors is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 899.00 in Sunstone Hotel Investors on November 2, 2024 and sell it today you would earn a total of 191.00 from holding Sunstone Hotel Investors or generate 21.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 80.58% |
| Values | Daily Returns |
Vastned Retail NV vs. Sunstone Hotel Investors
Performance |
| Timeline |
| Vastned Retail NV |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Sunstone Hotel Investors |
Vastned Retail and Sunstone Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vastned Retail and Sunstone Hotel
The main advantage of trading using opposite Vastned Retail and Sunstone Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vastned Retail position performs unexpectedly, Sunstone Hotel 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 Sunstone Hotel will offset losses from the drop in Sunstone Hotel's long position.| Vastned Retail vs. INVITATION HOMES DL | Vastned Retail vs. FRACTAL GAMING GROUP | Vastned Retail vs. CITY OFFICE REIT | Vastned Retail vs. TROPHY GAMES DEV |
| Sunstone Hotel vs. Hemisphere Energy Corp | Sunstone Hotel vs. AECOM TECHNOLOGY | Sunstone Hotel vs. Kingdee International Software | Sunstone Hotel vs. MACOM Technology Solutions |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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