Correlation Between COL Digital and BTG Hotels
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By analyzing existing cross correlation between COL Digital Publishing and BTG Hotels Group, you can compare the effects of market volatilities on COL Digital and BTG Hotels 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 COL Digital with a short position of BTG Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of COL Digital and BTG Hotels.
Diversification Opportunities for COL Digital and BTG Hotels
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between COL and BTG is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding COL Digital Publishing and BTG Hotels Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTG Hotels Group and COL Digital 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 COL Digital Publishing are associated (or correlated) with BTG Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTG Hotels Group has no effect on the direction of COL Digital i.e., COL Digital and BTG Hotels go up and down completely randomly.
Pair Corralation between COL Digital and BTG Hotels
Assuming the 90 days trading horizon COL Digital Publishing is expected to generate 1.52 times more return on investment than BTG Hotels. However, COL Digital is 1.52 times more volatile than BTG Hotels Group. It trades about 0.19 of its potential returns per unit of risk. BTG Hotels Group is currently generating about -0.17 per unit of risk. If you would invest 2,259 in COL Digital Publishing on November 7, 2024 and sell it today you would earn a total of 186.00 from holding COL Digital Publishing or generate 8.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COL Digital Publishing vs. BTG Hotels Group
Performance |
| Timeline |
| COL Digital Publishing |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| BTG Hotels Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
COL Digital and BTG Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COL Digital and BTG Hotels
The main advantage of trading using opposite COL Digital and BTG Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COL Digital position performs unexpectedly, BTG Hotels 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 BTG Hotels will offset losses from the drop in BTG Hotels' long position.The idea behind COL Digital Publishing and BTG Hotels Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| BTG Hotels vs. Zhejiang Zanyu Technology | BTG Hotels vs. Shanghai SK Automation | BTG Hotels vs. ShenZhen YUTO Packaging | BTG Hotels vs. Lao Feng Xiang |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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