Correlation Between Xenia Hotels and Games Workshop
Can any of the company-specific risk be diversified away by investing in both Xenia Hotels and Games Workshop 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 Games Workshop 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 Games Workshop Group, you can compare the effects of market volatilities on Xenia Hotels and Games Workshop 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 Games Workshop. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xenia Hotels and Games Workshop.
Diversification Opportunities for Xenia Hotels and Games Workshop
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xenia and Games is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Xenia Hotels Resorts and Games Workshop Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Games Workshop Group 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 Games Workshop. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Games Workshop Group has no effect on the direction of Xenia Hotels i.e., Xenia Hotels and Games Workshop go up and down completely randomly.
Pair Corralation between Xenia Hotels and Games Workshop
Assuming the 90 days trading horizon Xenia Hotels is expected to generate 3.23 times less return on investment than Games Workshop. But when comparing it to its historical volatility, Xenia Hotels Resorts is 1.27 times less risky than Games Workshop. It trades about 0.05 of its potential returns per unit of risk. Games Workshop Group is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 11,503 in Games Workshop Group on September 3, 2024 and sell it today you would earn a total of 5,397 from holding Games Workshop Group or generate 46.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xenia Hotels Resorts vs. Games Workshop Group
Performance |
| Timeline |
| Xenia Hotels Resorts |
| Games Workshop Group |
Xenia Hotels and Games Workshop Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xenia Hotels and Games Workshop
The main advantage of trading using opposite Xenia Hotels and Games Workshop positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xenia Hotels position performs unexpectedly, Games Workshop 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 Games Workshop will offset losses from the drop in Games Workshop's long position.| Xenia Hotels vs. Host Hotels Resorts | Xenia Hotels vs. Ryman Hospitality Properties | Xenia Hotels vs. Park Hotels Resorts | Xenia Hotels vs. Pebblebrook Hotel Trust |
| Games Workshop vs. TERADATA | Games Workshop vs. Marie Brizard Wine | Games Workshop vs. Haverty Furniture Companies | Games Workshop vs. DATANG INTL POW |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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