Correlation Between BTG Hotels and Changchun
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By analyzing existing cross correlation between BTG Hotels Group and Changchun UP Optotech, you can compare the effects of market volatilities on BTG Hotels and Changchun 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 Changchun. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTG Hotels and Changchun.
Diversification Opportunities for BTG Hotels and Changchun
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between BTG and Changchun is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding BTG Hotels Group and Changchun UP Optotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changchun UP Optotech 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 Changchun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changchun UP Optotech has no effect on the direction of BTG Hotels i.e., BTG Hotels and Changchun go up and down completely randomly.
Pair Corralation between BTG Hotels and Changchun
Assuming the 90 days trading horizon BTG Hotels is expected to generate 7.17 times less return on investment than Changchun. But when comparing it to its historical volatility, BTG Hotels Group is 2.78 times less risky than Changchun. It trades about 0.04 of its potential returns per unit of risk. Changchun UP Optotech is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 3,760 in Changchun UP Optotech on August 29, 2024 and sell it today you would earn a total of 304.00 from holding Changchun UP Optotech or generate 8.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BTG Hotels Group vs. Changchun UP Optotech
Performance |
| Timeline |
| BTG Hotels Group |
| Changchun UP Optotech |
BTG Hotels and Changchun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTG Hotels and Changchun
The main advantage of trading using opposite BTG Hotels and Changchun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTG Hotels position performs unexpectedly, Changchun 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 Changchun will offset losses from the drop in Changchun's long position.| BTG Hotels vs. Biwin Storage Technology | BTG Hotels vs. PetroChina Co Ltd | BTG Hotels vs. Industrial and Commercial | BTG Hotels vs. China Construction Bank |
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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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