Correlation Between Xenia Hotels and DALATA HOTEL
Can any of the company-specific risk be diversified away by investing in both Xenia Hotels and DALATA HOTEL 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 Xenia Hotels and DALATA HOTEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xenia Hotels Resorts and DALATA HOTEL, you can compare the effects of market volatilities on Xenia Hotels and DALATA HOTEL 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 Xenia Hotels with a short position of DALATA HOTEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xenia Hotels and DALATA HOTEL.
Diversification Opportunities for Xenia Hotels and DALATA HOTEL
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Xenia and DALATA is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Xenia Hotels Resorts and DALATA HOTEL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DALATA HOTEL and Xenia 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 Xenia Hotels Resorts are associated (or correlated) with DALATA HOTEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DALATA HOTEL has no effect on the direction of Xenia Hotels i.e., Xenia Hotels and DALATA HOTEL go up and down completely randomly.
Pair Corralation between Xenia Hotels and DALATA HOTEL
Assuming the 90 days trading horizon Xenia Hotels Resorts is expected to generate 0.56 times more return on investment than DALATA HOTEL. However, Xenia Hotels Resorts is 1.77 times less risky than DALATA HOTEL. It trades about 0.11 of its potential returns per unit of risk. DALATA HOTEL is currently generating about 0.05 per unit of risk. If you would invest 1,330 in Xenia Hotels Resorts on August 30, 2024 and sell it today you would earn a total of 130.00 from holding Xenia Hotels Resorts or generate 9.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.73% |
| Values | Daily Returns |
Xenia Hotels Resorts vs. DALATA HOTEL
Performance |
| Timeline |
| Xenia Hotels Resorts |
| DALATA HOTEL |
Xenia Hotels and DALATA HOTEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xenia Hotels and DALATA HOTEL
The main advantage of trading using opposite Xenia Hotels and DALATA HOTEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xenia Hotels position performs unexpectedly, DALATA HOTEL 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 DALATA HOTEL will offset losses from the drop in DALATA HOTEL's long position.| Xenia Hotels vs. PSI Software AG | Xenia Hotels vs. Ming Le Sports | Xenia Hotels vs. ATOSS SOFTWARE | Xenia Hotels vs. CyberArk Software |
| DALATA HOTEL vs. Apple Inc | DALATA HOTEL vs. Apple Inc | DALATA HOTEL vs. Superior Plus Corp | DALATA HOTEL vs. SIVERS SEMICONDUCTORS AB |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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