Correlation Between Wyndham Hotels and Atos SE
Can any of the company-specific risk be diversified away by investing in both Wyndham Hotels and Atos SE 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 Atos SE 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 Atos SE, you can compare the effects of market volatilities on Wyndham Hotels and Atos SE 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 Atos SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wyndham Hotels and Atos SE.
Diversification Opportunities for Wyndham Hotels and Atos SE
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Wyndham and Atos is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Wyndham Hotels Resorts and Atos SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atos SE 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 Atos SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atos SE has no effect on the direction of Wyndham Hotels i.e., Wyndham Hotels and Atos SE go up and down completely randomly.
Pair Corralation between Wyndham Hotels and Atos SE
Assuming the 90 days horizon Wyndham Hotels is expected to generate 38.03 times less return on investment than Atos SE. But when comparing it to its historical volatility, Wyndham Hotels Resorts is 65.98 times less risky than Atos SE. It trades about 0.23 of its potential returns per unit of risk. Atos SE is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 73.00 in Atos SE on September 23, 2024 and sell it today you would lose (72.79) from holding Atos SE or give up 99.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wyndham Hotels Resorts vs. Atos SE
Performance |
| Timeline |
| Wyndham Hotels Resorts |
| Atos SE |
Wyndham Hotels and Atos SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wyndham Hotels and Atos SE
The main advantage of trading using opposite Wyndham Hotels and Atos SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wyndham Hotels position performs unexpectedly, Atos SE 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 Atos SE will offset losses from the drop in Atos SE's long position.| Wyndham Hotels vs. WIZZ AIR HLDGUNSPADR4 | Wyndham Hotels vs. PennantPark Investment | Wyndham Hotels vs. SLR Investment Corp | Wyndham Hotels vs. ALTAIR RES INC |
| Atos SE vs. Accenture plc | Atos SE vs. International Business Machines | Atos SE vs. Infosys Limited | Atos SE vs. Cognizant Technology Solutions |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |