Sotherly Hotels Stock Volatility
| SOHO Stock | USD 1.27 0.03 2.42% |
Sotherly Hotels owns Efficiency Ratio (i.e., Sharpe Ratio) of -0.0622, which indicates the firm had a -0.0622% return per unit of risk over the last 3 months. Sotherly Hotels exposes twenty-four different technical indicators, which can help you to evaluate volatility embedded in its price movement. Please validate Sotherly Hotels' Risk Adjusted Performance of (0.03), variance of 3.96, and Coefficient Of Variation of (1,607) to confirm the risk estimate we provide. Key indicators related to Sotherly Hotels' volatility include:
60 Days Market Risk | Chance Of Distress | 60 Days Economic Sensitivity |
Sotherly Hotels Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Sotherly daily returns, and it is calculated using variance and standard deviation. We also use Sotherly's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Sotherly Hotels volatility.
Sotherly |
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Sotherly Hotels can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Sotherly Hotels at lower prices. For example, an investor can purchase Sotherly stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Sotherly Hotels' stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.
Moving against Sotherly Stock
| 0.68 | BHR | Braemar Hotel Resorts Financial Report 7th of May 2024 | PairCorr |
Sotherly Hotels Market Sensitivity And Downside Risk
Sotherly Hotels' beta coefficient measures the volatility of Sotherly stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Sotherly stock's returns against your selected market. In other words, Sotherly Hotels's beta of 0.91 provides an investor with an approximation of how much risk Sotherly Hotels stock can potentially add to one of your existing portfolios. Sotherly Hotels exhibits very low volatility with skewness of 0.52 and kurtosis of 0.37. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Sotherly Hotels' stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Sotherly Hotels' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Sotherly Hotels Demand TrendCheck current 90 days Sotherly Hotels correlation with market (NYSE Composite)Sotherly Beta |
Sotherly standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 1.99 |
It is essential to understand the difference between upside risk (as represented by Sotherly Hotels's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Sotherly Hotels' daily returns or price. Since the actual investment returns on holding a position in sotherly stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Sotherly Hotels.
Sotherly Hotels Stock Volatility Analysis
Volatility refers to the frequency at which Sotherly Hotels stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Sotherly Hotels' price changes. Investors will then calculate the volatility of Sotherly Hotels' stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Sotherly Hotels' volatility:
Historical Volatility
This type of stock volatility measures Sotherly Hotels' fluctuations based on previous trends. It's commonly used to predict Sotherly Hotels' future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for Sotherly Hotels' current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Sotherly Hotels' to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. Sotherly Hotels Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
Sotherly Hotels Projected Return Density Against Market
Given the investment horizon of 90 days Sotherly Hotels has a beta of 0.911 . This usually implies Sotherly Hotels market returns are highly reactive to returns on the market. As the market goes up or down, Sotherly Hotels is expected to follow.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Sotherly Hotels or Diversified REITs sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Sotherly Hotels' price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Sotherly stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Sotherly Hotels has a negative alpha, implying that the risk taken by holding this instrument is not justified. The company is significantly underperforming the NYSE Composite. Predicted Return Density |
| Returns |
What Drives a Sotherly Hotels Price Volatility?
Several factors can influence a stock's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.Sotherly Hotels Stock Risk Measures
Given the investment horizon of 90 days the coefficient of variation of Sotherly Hotels is -1607.38. The daily returns are distributed with a variance of 3.96 and standard deviation of 1.99. The mean deviation of Sotherly Hotels is currently at 1.5. For similar time horizon, the selected benchmark (NYSE Composite) has volatility of 0.62
α | Alpha over NYSE Composite | -0.21 | |
β | Beta against NYSE Composite | 0.91 | |
σ | Overall volatility | 1.99 | |
Ir | Information ratio | -0.11 |
Sotherly Hotels Stock Return Volatility
Sotherly Hotels historical daily return volatility represents how much of Sotherly Hotels stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The firm inherits 1.9902% risk (volatility on return distribution) over the 90 days horizon. By contrast, NYSE Composite accepts 0.6321% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About Sotherly Hotels Volatility
Volatility is a rate at which the price of Sotherly Hotels or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Sotherly Hotels may increase or decrease. In other words, similar to Sotherly's beta indicator, it measures the risk of Sotherly Hotels and helps estimate the fluctuations that may happen in a short period of time. So if prices of Sotherly Hotels fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.Sotherly Hotels Inc. is a self-managed and self-administered lodging REIT focused on the acquisition, renovation, upbranding and repositioning of upscale to upper-upscale full-service hotels in the Southern United States. Sotherly Hotels Inc. was organized in 2004 and is headquartered in Williamsburg, Virginia. Sotherly Hotels operates under REITHotel Motel classification in the United States and is traded on NASDAQ Exchange. It employs 10 people.
Sotherly Hotels' stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Sotherly Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Sotherly Hotels' price varies over time.
3 ways to utilize Sotherly Hotels' volatility to invest better
Higher Sotherly Hotels' stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Sotherly Hotels stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Sotherly Hotels stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Sotherly Hotels investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in Sotherly Hotels' stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of Sotherly Hotels' stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Sotherly Hotels Investment Opportunity
Sotherly Hotels has a volatility of 1.99 and is 3.16 times more volatile than NYSE Composite. 17 percent of all equities and portfolios are less risky than Sotherly Hotels. You can use Sotherly Hotels to enhance the returns of your portfolios. The stock experiences an unexpected upward trend. Watch out for market signals. Check odds of Sotherly Hotels to be traded at $1.524 in 90 days.Modest diversification
The correlation between Sotherly Hotels and NYA is 0.28 (i.e., Modest diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Sotherly Hotels and NYA in the same portfolio, assuming nothing else is changed.
Sotherly Hotels Additional Risk Indicators
The analysis of Sotherly Hotels' secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Sotherly Hotels' investment and either accepting that risk or mitigating it. Along with some common measures of Sotherly Hotels stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | (0.03) | |||
| Market Risk Adjusted Performance | (0.14) | |||
| Mean Deviation | 1.5 | |||
| Coefficient Of Variation | (1,607) | |||
| Standard Deviation | 1.99 | |||
| Variance | 3.96 | |||
| Information Ratio | (0.11) |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
Sotherly Hotels Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Sotherly Hotels as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Sotherly Hotels' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Sotherly Hotels' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Sotherly Hotels.
When determining whether Sotherly Hotels offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Sotherly Hotels' financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Sotherly Hotels Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Sotherly Hotels Stock: Check out World Market Map to better understand how to build diversified portfolios, which includes a position in Sotherly Hotels. Also, note that the market value of any company could be tightly coupled with the direction of predictive economic indicators such as signals in rate. To learn how to invest in Sotherly Stock, please use our How to Invest in Sotherly Hotels guide.Note that the Sotherly Hotels information on this page should be used as a complementary analysis to other Sotherly Hotels' statistical models used 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Complementary Tools for Sotherly Stock analysis
When running Sotherly Hotels' price analysis, check to measure Sotherly Hotels' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Sotherly Hotels is operating at the current time. Most of Sotherly Hotels' value examination focuses on studying past and present price action to predict the probability of Sotherly Hotels' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Sotherly Hotels' price. Additionally, you may evaluate how the addition of Sotherly Hotels to your portfolios can decrease your overall portfolio volatility.
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Is Sotherly Hotels' industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Sotherly Hotels. If investors know Sotherly will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Sotherly Hotels listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
The market value of Sotherly Hotels is measured differently than its book value, which is the value of Sotherly that is recorded on the company's balance sheet. Investors also form their own opinion of Sotherly Hotels' value that differs from its market value or its book value, called intrinsic value, which is Sotherly Hotels' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Sotherly Hotels' market value can be influenced by many factors that don't directly affect Sotherly Hotels' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Sotherly Hotels' value and its price as these two are different measures arrived at by different means. Investors typically determine if Sotherly Hotels is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Sotherly Hotels' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.