Correlation Between Guangzhou Dongfang and BTG Hotels
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By analyzing existing cross correlation between Guangzhou Dongfang Hotel and BTG Hotels Group, you can compare the effects of market volatilities on Guangzhou Dongfang and BTG Hotels 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 Guangzhou Dongfang with a short position of BTG Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Dongfang and BTG Hotels.
Diversification Opportunities for Guangzhou Dongfang and BTG Hotels
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guangzhou and BTG is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Dongfang Hotel and BTG Hotels Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTG Hotels Group and Guangzhou Dongfang 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 Guangzhou Dongfang Hotel are associated (or correlated) with BTG Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTG Hotels Group has no effect on the direction of Guangzhou Dongfang i.e., Guangzhou Dongfang and BTG Hotels go up and down completely randomly.
Pair Corralation between Guangzhou Dongfang and BTG Hotels
Assuming the 90 days trading horizon Guangzhou Dongfang Hotel is expected to generate 2.01 times more return on investment than BTG Hotels. However, Guangzhou Dongfang is 2.01 times more volatile than BTG Hotels Group. It trades about -0.22 of its potential returns per unit of risk. BTG Hotels Group is currently generating about -0.54 per unit of risk. If you would invest 1,059 in Guangzhou Dongfang Hotel on October 12, 2024 and sell it today you would lose (147.00) from holding Guangzhou Dongfang Hotel or give up 13.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Dongfang Hotel vs. BTG Hotels Group
Performance |
| Timeline |
| Guangzhou Dongfang Hotel |
| BTG Hotels Group |
Guangzhou Dongfang and BTG Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Dongfang and BTG Hotels
The main advantage of trading using opposite Guangzhou Dongfang and BTG Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Dongfang position performs unexpectedly, BTG Hotels 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 BTG Hotels will offset losses from the drop in BTG Hotels' long position.| Guangzhou Dongfang vs. Shaanxi Meineng Clean | Guangzhou Dongfang vs. Rongcheer Industrial Technology | Guangzhou Dongfang vs. Western Metal Materials | Guangzhou Dongfang vs. Minmetals Capital Co |
| BTG Hotels vs. Sichuan Teway Food | BTG Hotels vs. Qingdao Foods Co | BTG Hotels vs. Jinhui Liquor Co | BTG Hotels vs. Jiajia Food Group |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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