Correlation Between Ashford Hospitality and Public Storage
Can any of the company-specific risk be diversified away by investing in both Ashford Hospitality and Public Storage 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 Ashford Hospitality and Public Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashford Hospitality Trust and Public Storage, you can compare the effects of market volatilities on Ashford Hospitality and Public Storage 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 Ashford Hospitality with a short position of Public Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashford Hospitality and Public Storage.
Diversification Opportunities for Ashford Hospitality and Public Storage
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ashford and Public is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Ashford Hospitality Trust and Public Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Public Storage and Ashford Hospitality 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 Ashford Hospitality Trust are associated (or correlated) with Public Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Public Storage has no effect on the direction of Ashford Hospitality i.e., Ashford Hospitality and Public Storage go up and down completely randomly.
Pair Corralation between Ashford Hospitality and Public Storage
Assuming the 90 days trading horizon Ashford Hospitality Trust is expected to under-perform the Public Storage. In addition to that, Ashford Hospitality is 3.55 times more volatile than Public Storage. It trades about -0.09 of its total potential returns per unit of risk. Public Storage is currently generating about -0.15 per unit of volatility. If you would invest 1,933 in Public Storage on September 12, 2024 and sell it today you would lose (162.00) from holding Public Storage or give up 8.38% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Ashford Hospitality Trust vs. Public Storage
Performance |
Timeline |
Ashford Hospitality Trust |
Public Storage |
Ashford Hospitality and Public Storage Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ashford Hospitality and Public Storage
The main advantage of trading using opposite Ashford Hospitality and Public Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashford Hospitality position performs unexpectedly, Public Storage 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 Public Storage will offset losses from the drop in Public Storage's long position.Ashford Hospitality vs. Braemar Hotels Resorts | Ashford Hospitality vs. Braemar Hotels Resorts | Ashford Hospitality vs. Ashford Hospitality Trust | Ashford Hospitality vs. Ashford Hospitality Trust |
Public Storage vs. Public Storage | Public Storage vs. Public Storage | Public Storage vs. Public Storage | Public Storage vs. Public Storage |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |