Correlation Between Penyao Environmental and BTG Hotels
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By analyzing existing cross correlation between Penyao Environmental Protection and BTG Hotels Group, you can compare the effects of market volatilities on Penyao Environmental 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 Penyao Environmental with a short position of BTG Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penyao Environmental and BTG Hotels.
Diversification Opportunities for Penyao Environmental and BTG Hotels
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Penyao and BTG is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Penyao Environmental Protectio 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 Penyao Environmental 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 Penyao Environmental Protection 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 Penyao Environmental i.e., Penyao Environmental and BTG Hotels go up and down completely randomly.
Pair Corralation between Penyao Environmental and BTG Hotels
Assuming the 90 days trading horizon Penyao Environmental Protection is expected to generate 2.43 times more return on investment than BTG Hotels. However, Penyao Environmental is 2.43 times more volatile than BTG Hotels Group. It trades about 0.03 of its potential returns per unit of risk. BTG Hotels Group is currently generating about 0.08 per unit of risk. If you would invest 561.00 in Penyao Environmental Protection on September 27, 2024 and sell it today you would earn a total of 7.00 from holding Penyao Environmental Protection or generate 1.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Penyao Environmental Protectio vs. BTG Hotels Group
Performance |
| Timeline |
| Penyao Environmental |
| BTG Hotels Group |
Penyao Environmental and BTG Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Penyao Environmental and BTG Hotels
The main advantage of trading using opposite Penyao Environmental and BTG Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Penyao Environmental 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.| Penyao Environmental vs. Shenzhen MYS Environmental | Penyao Environmental vs. AVIC Fund Management | Penyao Environmental vs. Shenzhen Bingchuan Network | Penyao Environmental vs. Penghua Shenzhen Energy |
| BTG Hotels vs. Bank of China | BTG Hotels vs. Kweichow Moutai Co | BTG Hotels vs. PetroChina Co Ltd | BTG Hotels vs. Bank of Communications |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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