Correlation Between STAG Industrial and Ryman Hospitality

Can any of the company-specific risk be diversified away by investing in both STAG Industrial and Ryman Hospitality 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 STAG Industrial and Ryman Hospitality into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between STAG Industrial and Ryman Hospitality Properties, you can compare the effects of market volatilities on STAG Industrial and Ryman Hospitality 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 STAG Industrial with a short position of Ryman Hospitality. Check out your portfolio center. Please also check ongoing floating volatility patterns of STAG Industrial and Ryman Hospitality.

Diversification Opportunities for STAG Industrial and Ryman Hospitality

-0.62

Correlation Coefficient

STAG Industrial  Ryman Hospitality

Excellent diversification

The 3 months correlation between STAG and Ryman is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding STAG Industrial and Ryman Hospitality Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ryman Hospitality and STAG Industrial 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 STAG Industrial are associated (or correlated) with Ryman Hospitality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ryman Hospitality has no effect on the direction of STAG Industrial i.e., STAG Industrial and Ryman Hospitality go up and down completely randomly.

Pair Corralation between STAG Industrial and Ryman Hospitality

Given the investment horizon of 90 days STAG Industrial is expected to generate 0.87 times more return on investment than Ryman Hospitality. However, STAG Industrial is 1.15 times less risky than Ryman Hospitality. It trades about 0.08 of its potential returns per unit of risk. Ryman Hospitality Properties is currently generating about -0.11 per unit of risk. If you would invest  3,340  in STAG Industrial on December 28, 2024 and sell it today you would earn a total of  204.00  from holding STAG Industrial or generate 6.11% return on investment over 90 days.

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

STAG Industrial  vs.  Ryman Hospitality Properties

STAG Industrial

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in STAG Industrial are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, STAG Industrial may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Ryman Hospitality

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ryman Hospitality Properties has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest sluggish performance, the Stock's technical indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with STAG Industrial and Ryman Hospitality

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

The idea behind STAG Industrial and Ryman Hospitality Properties 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 Positions Ratings module to 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.