Correlation Between Park Hotels and OTP Bank
Can any of the company-specific risk be diversified away by investing in both Park Hotels and OTP Bank 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 Park Hotels and OTP Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Park Hotels Resorts and OTP Bank Nyrt, you can compare the effects of market volatilities on Park Hotels and OTP Bank 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 Park Hotels with a short position of OTP Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Park Hotels and OTP Bank.
Diversification Opportunities for Park Hotels and OTP Bank
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Park and OTP is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Park Hotels Resorts and OTP Bank Nyrt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OTP Bank Nyrt and Park Hotels 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 Park Hotels Resorts are associated (or correlated) with OTP Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OTP Bank Nyrt has no effect on the direction of Park Hotels i.e., Park Hotels and OTP Bank go up and down completely randomly.
Pair Corralation between Park Hotels and OTP Bank
Assuming the 90 days trading horizon Park Hotels Resorts is expected to under-perform the OTP Bank. But the stock apears to be less risky and, when comparing its historical volatility, Park Hotels Resorts is 5.29 times less risky than OTP Bank. The stock trades about -0.01 of its potential returns per unit of risk. The OTP Bank Nyrt is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,205,054 in OTP Bank Nyrt on August 29, 2024 and sell it today you would earn a total of 53,946 from holding OTP Bank Nyrt or generate 4.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.95% |
| Values | Daily Returns |
Park Hotels Resorts vs. OTP Bank Nyrt
Performance |
| Timeline |
| Park Hotels Resorts |
| OTP Bank Nyrt |
Park Hotels and OTP Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Park Hotels and OTP Bank
The main advantage of trading using opposite Park Hotels and OTP Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Park Hotels position performs unexpectedly, OTP Bank 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 OTP Bank will offset losses from the drop in OTP Bank's long position.| Park Hotels vs. Lendinvest PLC | Park Hotels vs. Neometals | Park Hotels vs. Coor Service Management | Park Hotels vs. Albion Technology General |
| OTP Bank vs. Lendinvest PLC | OTP Bank vs. Neometals | OTP Bank vs. Coor Service Management | OTP Bank vs. Albion Technology General |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |