Correlation Between BTG Hotels and Guangzhou Dongfang
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By analyzing existing cross correlation between BTG Hotels Group and Guangzhou Dongfang Hotel, you can compare the effects of market volatilities on BTG Hotels and Guangzhou Dongfang 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 BTG Hotels with a short position of Guangzhou Dongfang. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTG Hotels and Guangzhou Dongfang.
Diversification Opportunities for BTG Hotels and Guangzhou Dongfang
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BTG and Guangzhou is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding BTG Hotels Group and Guangzhou Dongfang Hotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Dongfang Hotel and BTG 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 BTG Hotels Group are associated (or correlated) with Guangzhou Dongfang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Dongfang Hotel has no effect on the direction of BTG Hotels i.e., BTG Hotels and Guangzhou Dongfang go up and down completely randomly.
Pair Corralation between BTG Hotels and Guangzhou Dongfang
Assuming the 90 days trading horizon BTG Hotels Group is expected to under-perform the Guangzhou Dongfang. But the stock apears to be less risky and, when comparing its historical volatility, BTG Hotels Group is 2.01 times less risky than Guangzhou Dongfang. The stock trades about -0.54 of its potential returns per unit of risk. The Guangzhou Dongfang Hotel is currently generating about -0.22 of returns per unit of risk over similar time horizon. If you would invest 1,059 in Guangzhou Dongfang Hotel on October 12, 2024 and sell it today you would lose (147.00) from holding Guangzhou Dongfang Hotel or give up 13.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BTG Hotels Group vs. Guangzhou Dongfang Hotel
Performance |
| Timeline |
| BTG Hotels Group |
| Guangzhou Dongfang Hotel |
BTG Hotels and Guangzhou Dongfang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTG Hotels and Guangzhou Dongfang
The main advantage of trading using opposite BTG Hotels and Guangzhou Dongfang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTG Hotels position performs unexpectedly, Guangzhou Dongfang 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 Guangzhou Dongfang will offset losses from the drop in Guangzhou Dongfang's long position.| BTG Hotels vs. Sichuan Teway Food | BTG Hotels vs. Qingdao Foods Co | BTG Hotels vs. Jinhui Liquor Co | BTG Hotels vs. Jiajia Food Group |
| Guangzhou Dongfang vs. Shaanxi Meineng Clean | Guangzhou Dongfang vs. Rongcheer Industrial Technology | Guangzhou Dongfang vs. Western Metal Materials | Guangzhou Dongfang vs. Minmetals Capital Co |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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