Correlation Between Lundin Mining and Wyndham Hotels
Can any of the company-specific risk be diversified away by investing in both Lundin Mining and Wyndham Hotels 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 Lundin Mining and Wyndham Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lundin Mining Corp and Wyndham Hotels Resorts, you can compare the effects of market volatilities on Lundin Mining and Wyndham 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 Lundin Mining with a short position of Wyndham Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lundin Mining and Wyndham Hotels.
Diversification Opportunities for Lundin Mining and Wyndham Hotels
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lundin and Wyndham is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Lundin Mining Corp and Wyndham Hotels Resorts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wyndham Hotels Resorts and Lundin Mining 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 Lundin Mining Corp are associated (or correlated) with Wyndham Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wyndham Hotels Resorts has no effect on the direction of Lundin Mining i.e., Lundin Mining and Wyndham Hotels go up and down completely randomly.
Pair Corralation between Lundin Mining and Wyndham Hotels
Assuming the 90 days trading horizon Lundin Mining is expected to generate 56.54 times less return on investment than Wyndham Hotels. In addition to that, Lundin Mining is 1.66 times more volatile than Wyndham Hotels Resorts. It trades about 0.0 of its total potential returns per unit of risk. Wyndham Hotels Resorts is currently generating about 0.16 per unit of volatility. If you would invest 7,104 in Wyndham Hotels Resorts on September 2, 2024 and sell it today you would earn a total of 2,682 from holding Wyndham Hotels Resorts or generate 37.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.23% |
| Values | Daily Returns |
Lundin Mining Corp vs. Wyndham Hotels Resorts
Performance |
| Timeline |
| Lundin Mining Corp |
| Wyndham Hotels Resorts |
Lundin Mining and Wyndham Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lundin Mining and Wyndham Hotels
The main advantage of trading using opposite Lundin Mining and Wyndham Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lundin Mining position performs unexpectedly, Wyndham 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 Wyndham Hotels will offset losses from the drop in Wyndham Hotels' long position.| Lundin Mining vs. Supermarket Income REIT | Lundin Mining vs. Ecclesiastical Insurance Office | Lundin Mining vs. Batm Advanced Communications | Lundin Mining vs. Team Internet Group |
| Wyndham Hotels vs. JD Sports Fashion | Wyndham Hotels vs. Intermediate Capital Group | Wyndham Hotels vs. Centaur Media | Wyndham Hotels vs. Zoom Video Communications |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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