Correlation Between Conifer Holding and Braemar Hotel

Can any of the company-specific risk be diversified away by investing in both Conifer Holding and Braemar 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 Conifer Holding and Braemar Hotel into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Conifer Holding and Braemar Hotel Resorts, you can compare the effects of market volatilities on Conifer Holding and Braemar 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 Conifer Holding with a short position of Braemar Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Conifer Holding and Braemar Hotel.

Diversification Opportunities for Conifer Holding and Braemar Hotel

-0.09

Correlation Coefficient

Conifer Holding  Braemar Hotel

Good diversification

The 3 months correlation between Conifer and Braemar is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Conifer Holding and Braemar Hotel Resorts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Braemar Hotel Resorts and Conifer Holding 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 Conifer Holding are associated (or correlated) with Braemar Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Braemar Hotel Resorts has no effect on the direction of Conifer Holding i.e., Conifer Holding and Braemar Hotel go up and down completely randomly.

Pair Corralation between Conifer Holding and Braemar Hotel

Given the investment horizon of 90 days Conifer Holding is expected to under-perform the Braemar Hotel. In addition to that, Conifer Holding is 1.32 times more volatile than Braemar Hotel Resorts. It trades about -0.19 of its total potential returns per unit of risk. Braemar Hotel Resorts is currently generating about -0.08 per unit of volatility. If you would invest  312.00  in Braemar Hotel Resorts on December 28, 2024 and sell it today you would lose (49.00) from holding Braemar Hotel Resorts or give up 15.71% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Conifer Holding  vs.  Braemar Hotel Resorts

Conifer Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days Conifer Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Braemar Hotel Resorts

Risk-Adjusted Performance

Very Weak

Over the last 90 days Braemar Hotel Resorts has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unfluctuating performance in the last few months, the Stock's technical indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Conifer Holding and Braemar Hotel

The main advantage of trading using opposite Conifer Holding and Braemar Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Conifer Holding position performs unexpectedly, Braemar 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 Braemar Hotel will offset losses from the drop in Braemar Hotel's long position.

The idea behind Conifer Holding and Braemar Hotel Resorts pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Bonds Directory module to find actively traded corporate debentures issued by US companies.