Correlation Between HYATT HOTELS-A and HUT 8
Can any of the company-specific risk be diversified away by investing in both HYATT HOTELS-A and HUT 8 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 HYATT HOTELS-A and HUT 8 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HYATT HOTELS A and HUT 8 P, you can compare the effects of market volatilities on HYATT HOTELS-A and HUT 8 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 HYATT HOTELS-A with a short position of HUT 8. Check out your portfolio center. Please also check ongoing floating volatility patterns of HYATT HOTELS-A and HUT 8.
Diversification Opportunities for HYATT HOTELS-A and HUT 8
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HYATT and HUT is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding HYATT HOTELS A and HUT 8 P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUT 8 P and HYATT HOTELS-A 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 HYATT HOTELS A are associated (or correlated) with HUT 8. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HUT 8 P has no effect on the direction of HYATT HOTELS-A i.e., HYATT HOTELS-A and HUT 8 go up and down completely randomly.
Pair Corralation between HYATT HOTELS-A and HUT 8
Assuming the 90 days trading horizon HYATT HOTELS A is expected to generate 0.49 times more return on investment than HUT 8. However, HYATT HOTELS A is 2.04 times less risky than HUT 8. It trades about -0.18 of its potential returns per unit of risk. HUT 8 P is currently generating about -0.25 per unit of risk. If you would invest 14,820 in HYATT HOTELS A on November 28, 2024 and sell it today you would lose (1,610) from holding HYATT HOTELS A or give up 10.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HYATT HOTELS A vs. HUT 8 P
Performance |
| Timeline |
| HYATT HOTELS A |
| HUT 8 P |
HYATT HOTELS-A and HUT 8 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HYATT HOTELS-A and HUT 8
The main advantage of trading using opposite HYATT HOTELS-A and HUT 8 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HYATT HOTELS-A position performs unexpectedly, HUT 8 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 HUT 8 will offset losses from the drop in HUT 8's long position.| HYATT HOTELS-A vs. MOLSON RS BEVERAGE | HYATT HOTELS-A vs. Boston Beer Co | HYATT HOTELS-A vs. AEGEAN AIRLINES | HYATT HOTELS-A vs. ScanSource |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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