Correlation Between BTG Hotels and Hunan Tyen
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By analyzing existing cross correlation between BTG Hotels Group and Hunan Tyen Machinery, you can compare the effects of market volatilities on BTG Hotels and Hunan Tyen 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 Hunan Tyen. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTG Hotels and Hunan Tyen.
Diversification Opportunities for BTG Hotels and Hunan Tyen
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BTG and Hunan is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding BTG Hotels Group and Hunan Tyen Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hunan Tyen Machinery 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 Hunan Tyen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hunan Tyen Machinery has no effect on the direction of BTG Hotels i.e., BTG Hotels and Hunan Tyen go up and down completely randomly.
Pair Corralation between BTG Hotels and Hunan Tyen
Assuming the 90 days trading horizon BTG Hotels is expected to generate 2.24 times less return on investment than Hunan Tyen. But when comparing it to its historical volatility, BTG Hotels Group is 1.58 times less risky than Hunan Tyen. It trades about 0.13 of its potential returns per unit of risk. Hunan Tyen Machinery is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 337.00 in Hunan Tyen Machinery on August 25, 2024 and sell it today you would earn a total of 173.00 from holding Hunan Tyen Machinery or generate 51.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BTG Hotels Group vs. Hunan Tyen Machinery
Performance |
| Timeline |
| BTG Hotels Group |
| Hunan Tyen Machinery |
BTG Hotels and Hunan Tyen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTG Hotels and Hunan Tyen
The main advantage of trading using opposite BTG Hotels and Hunan Tyen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTG Hotels position performs unexpectedly, Hunan Tyen 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 Hunan Tyen will offset losses from the drop in Hunan Tyen'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 |
| Hunan Tyen vs. Jinling Hotel Corp | Hunan Tyen vs. BTG Hotels Group | Hunan Tyen vs. Epoxy Base Electronic | Hunan Tyen vs. Fiberhome Telecommunication Technologies |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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