Correlation Between BRAEMAR HOTELS and Hyatt Hotels
Can any of the company-specific risk be diversified away by investing in both BRAEMAR HOTELS and Hyatt Hotels 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 BRAEMAR HOTELS and Hyatt Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BRAEMAR HOTELS RES and Hyatt Hotels, you can compare the effects of market volatilities on BRAEMAR HOTELS and Hyatt 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 BRAEMAR HOTELS with a short position of Hyatt Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of BRAEMAR HOTELS and Hyatt Hotels.
Diversification Opportunities for BRAEMAR HOTELS and Hyatt Hotels
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BRAEMAR and Hyatt is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding BRAEMAR HOTELS RES and Hyatt Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyatt Hotels and BRAEMAR 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 BRAEMAR HOTELS RES are associated (or correlated) with Hyatt Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyatt Hotels has no effect on the direction of BRAEMAR HOTELS i.e., BRAEMAR HOTELS and Hyatt Hotels go up and down completely randomly.
Pair Corralation between BRAEMAR HOTELS and Hyatt Hotels
Assuming the 90 days horizon BRAEMAR HOTELS RES is expected to under-perform the Hyatt Hotels. In addition to that, BRAEMAR HOTELS is 1.98 times more volatile than Hyatt Hotels. It trades about -0.19 of its total potential returns per unit of risk. Hyatt Hotels is currently generating about -0.15 per unit of volatility. If you would invest 15,405 in Hyatt Hotels on October 10, 2024 and sell it today you would lose (720.00) from holding Hyatt Hotels or give up 4.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BRAEMAR HOTELS RES vs. Hyatt Hotels
Performance |
| Timeline |
| BRAEMAR HOTELS RES |
| Hyatt Hotels |
BRAEMAR HOTELS and Hyatt Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BRAEMAR HOTELS and Hyatt Hotels
The main advantage of trading using opposite BRAEMAR HOTELS and Hyatt Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BRAEMAR HOTELS position performs unexpectedly, Hyatt 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 Hyatt Hotels will offset losses from the drop in Hyatt Hotels' long position.| BRAEMAR HOTELS vs. PARKEN Sport Entertainment | BRAEMAR HOTELS vs. ARDAGH METAL PACDL 0001 | BRAEMAR HOTELS vs. Osisko Metals | BRAEMAR HOTELS vs. UPDATE SOFTWARE |
| Hyatt Hotels vs. Hisense Home Appliances | Hyatt Hotels vs. Taylor Morrison Home | Hyatt Hotels vs. The Home Depot | Hyatt Hotels vs. Focus Home Interactive |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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