Correlation Between Summit Hotel and FitLife Brands,

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

By analyzing existing cross correlation between Summit Hotel Properties and FitLife Brands, Common, you can compare the effects of market volatilities on Summit Hotel and FitLife Brands, 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 Summit Hotel with a short position of FitLife Brands,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Hotel and FitLife Brands,.

Diversification Opportunities for Summit Hotel and FitLife Brands,

0.24

Correlation Coefficient

Summit Hotel  FitLife Brands,

Modest diversification

The 3 months correlation between Summit and FitLife is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Summit Hotel Properties and FitLife Brands, Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FitLife Brands, Common and Summit 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 Summit Hotel Properties are associated (or correlated) with FitLife Brands,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FitLife Brands, Common has no effect on the direction of Summit Hotel i.e., Summit Hotel and FitLife Brands, go up and down completely randomly.

Pair Corralation between Summit Hotel and FitLife Brands,

Considering the 90-day investment horizon Summit Hotel Properties is expected to under-perform the FitLife Brands,. But the stock apears to be less risky and, when comparing its historical volatility, Summit Hotel Properties is 2.09 times less risky than FitLife Brands,. The stock trades about -0.07 of its potential returns per unit of risk. The FitLife Brands, Common is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest  3,225  in FitLife Brands, Common on October 24, 2024 and sell it today you would lose (61.00) from holding FitLife Brands, Common or give up 1.89% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Summit Hotel Properties  vs.  FitLife Brands, Common

Summit Hotel Properties

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Summit Hotel Properties are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Summit Hotel may actually be approaching a critical reversion point that can send shares even higher in February 2025.

FitLife Brands, Common

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days FitLife Brands, Common has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, FitLife Brands, is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Summit Hotel and FitLife Brands,

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

The idea behind Summit Hotel Properties and FitLife Brands, Common 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.

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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.