Correlation Between Wyndham Hotels and NEWELL RUBBERMAID
Can any of the company-specific risk be diversified away by investing in both Wyndham Hotels and NEWELL RUBBERMAID 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 NEWELL RUBBERMAID 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 NEWELL RUBBERMAID , you can compare the effects of market volatilities on Wyndham Hotels and NEWELL RUBBERMAID 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 NEWELL RUBBERMAID. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wyndham Hotels and NEWELL RUBBERMAID.
Diversification Opportunities for Wyndham Hotels and NEWELL RUBBERMAID
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Wyndham and NEWELL is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Wyndham Hotels Resorts and NEWELL RUBBERMAID in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEWELL RUBBERMAID 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 NEWELL RUBBERMAID. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEWELL RUBBERMAID has no effect on the direction of Wyndham Hotels i.e., Wyndham Hotels and NEWELL RUBBERMAID go up and down completely randomly.
Pair Corralation between Wyndham Hotels and NEWELL RUBBERMAID
Assuming the 90 days horizon Wyndham Hotels Resorts is expected to generate 0.73 times more return on investment than NEWELL RUBBERMAID. However, Wyndham Hotels Resorts is 1.38 times less risky than NEWELL RUBBERMAID. It trades about -0.12 of its potential returns per unit of risk. NEWELL RUBBERMAID is currently generating about -0.48 per unit of risk. If you would invest 9,850 in Wyndham Hotels Resorts on October 14, 2024 and sell it today you would lose (250.00) from holding Wyndham Hotels Resorts or give up 2.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wyndham Hotels Resorts vs. NEWELL RUBBERMAID
Performance |
| Timeline |
| Wyndham Hotels Resorts |
| NEWELL RUBBERMAID |
Wyndham Hotels and NEWELL RUBBERMAID Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wyndham Hotels and NEWELL RUBBERMAID
The main advantage of trading using opposite Wyndham Hotels and NEWELL RUBBERMAID positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wyndham Hotels position performs unexpectedly, NEWELL RUBBERMAID 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 NEWELL RUBBERMAID will offset losses from the drop in NEWELL RUBBERMAID's long position.| Wyndham Hotels vs. SPORT LISBOA E | Wyndham Hotels vs. Keck Seng Investments | Wyndham Hotels vs. DICKS Sporting Goods | Wyndham Hotels vs. EAT WELL INVESTMENT |
| NEWELL RUBBERMAID vs. COVIVIO HOTELS INH | NEWELL RUBBERMAID vs. Dalata Hotel Group | NEWELL RUBBERMAID vs. Wyndham Hotels Resorts | NEWELL RUBBERMAID vs. NH HOTEL 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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