Correlation Between Wyndham Hotels and Ameriprise Financial
Can any of the company-specific risk be diversified away by investing in both Wyndham Hotels and Ameriprise Financial 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 Wyndham Hotels and Ameriprise Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wyndham Hotels Resorts and Ameriprise Financial, you can compare the effects of market volatilities on Wyndham Hotels and Ameriprise Financial 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 Wyndham Hotels with a short position of Ameriprise Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wyndham Hotels and Ameriprise Financial.
Diversification Opportunities for Wyndham Hotels and Ameriprise Financial
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wyndham and Ameriprise is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Wyndham Hotels Resorts and Ameriprise Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameriprise Financial and Wyndham 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 Wyndham Hotels Resorts are associated (or correlated) with Ameriprise Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameriprise Financial has no effect on the direction of Wyndham Hotels i.e., Wyndham Hotels and Ameriprise Financial go up and down completely randomly.
Pair Corralation between Wyndham Hotels and Ameriprise Financial
Assuming the 90 days trading horizon Wyndham Hotels is expected to generate 1.28 times less return on investment than Ameriprise Financial. In addition to that, Wyndham Hotels is 1.07 times more volatile than Ameriprise Financial. It trades about 0.09 of its total potential returns per unit of risk. Ameriprise Financial is currently generating about 0.12 per unit of volatility. If you would invest 38,528 in Ameriprise Financial on October 29, 2024 and sell it today you would earn a total of 18,086 from holding Ameriprise Financial or generate 46.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.17% |
| Values | Daily Returns |
Wyndham Hotels Resorts vs. Ameriprise Financial
Performance |
| Timeline |
| Wyndham Hotels Resorts |
| Ameriprise Financial |
Wyndham Hotels and Ameriprise Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wyndham Hotels and Ameriprise Financial
The main advantage of trading using opposite Wyndham Hotels and Ameriprise Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wyndham Hotels position performs unexpectedly, Ameriprise Financial 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 Ameriprise Financial will offset losses from the drop in Ameriprise Financial's long position.| Wyndham Hotels vs. Lundin Mining Corp | Wyndham Hotels vs. iShares Physical Silver | Wyndham Hotels vs. Synthomer plc | Wyndham Hotels vs. Bisichi Mining PLC |
| Ameriprise Financial vs. Clean Power Hydrogen | Ameriprise Financial vs. Target Healthcare REIT | Ameriprise Financial vs. Induction Healthcare Group | Ameriprise Financial vs. Made Tech 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |