Correlation Between BRAEMAR HOTELS and PPHE HOTEL
Can any of the company-specific risk be diversified away by investing in both BRAEMAR HOTELS and PPHE HOTEL 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 PPHE HOTEL 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 PPHE HOTEL GROUP, you can compare the effects of market volatilities on BRAEMAR HOTELS and PPHE HOTEL 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 PPHE HOTEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of BRAEMAR HOTELS and PPHE HOTEL.
Diversification Opportunities for BRAEMAR HOTELS and PPHE HOTEL
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BRAEMAR and PPHE is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding BRAEMAR HOTELS RES and PPHE HOTEL GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PPHE HOTEL GROUP 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 PPHE HOTEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PPHE HOTEL GROUP has no effect on the direction of BRAEMAR HOTELS i.e., BRAEMAR HOTELS and PPHE HOTEL go up and down completely randomly.
Pair Corralation between BRAEMAR HOTELS and PPHE HOTEL
Assuming the 90 days horizon BRAEMAR HOTELS RES is expected to under-perform the PPHE HOTEL. In addition to that, BRAEMAR HOTELS is 1.94 times more volatile than PPHE HOTEL GROUP. It trades about -0.15 of its total potential returns per unit of risk. PPHE HOTEL GROUP is currently generating about 0.03 per unit of volatility. If you would invest 1,580 in PPHE HOTEL GROUP on October 12, 2024 and sell it today you would earn a total of 10.00 from holding PPHE HOTEL GROUP or generate 0.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BRAEMAR HOTELS RES vs. PPHE HOTEL GROUP
Performance |
| Timeline |
| BRAEMAR HOTELS RES |
| PPHE HOTEL GROUP |
BRAEMAR HOTELS and PPHE HOTEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BRAEMAR HOTELS and PPHE HOTEL
The main advantage of trading using opposite BRAEMAR HOTELS and PPHE HOTEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BRAEMAR HOTELS position performs unexpectedly, PPHE HOTEL 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 PPHE HOTEL will offset losses from the drop in PPHE HOTEL's long position.| BRAEMAR HOTELS vs. Hua Hong Semiconductor | BRAEMAR HOTELS vs. DEVRY EDUCATION GRP | BRAEMAR HOTELS vs. TAL Education Group | BRAEMAR HOTELS vs. TOREX SEMICONDUCTOR LTD |
| PPHE HOTEL vs. T MOBILE US | PPHE HOTEL vs. Cogent Communications Holdings | PPHE HOTEL vs. MOBILE FACTORY INC | PPHE HOTEL vs. Air Transport Services |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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