Correlation Between BJs Wholesale and HYATT HOTELS
Can any of the company-specific risk be diversified away by investing in both BJs Wholesale 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 BJs Wholesale and HYATT HOTELS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BJs Wholesale Club and HYATT HOTELS A, you can compare the effects of market volatilities on BJs Wholesale 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 BJs Wholesale with a short position of HYATT HOTELS. Check out your portfolio center. Please also check ongoing floating volatility patterns of BJs Wholesale and HYATT HOTELS.
Diversification Opportunities for BJs Wholesale and HYATT HOTELS
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BJs and HYATT is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding BJs Wholesale Club and HYATT HOTELS A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HYATT HOTELS A and BJs Wholesale 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 BJs Wholesale Club 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 A has no effect on the direction of BJs Wholesale i.e., BJs Wholesale and HYATT HOTELS go up and down completely randomly.
Pair Corralation between BJs Wholesale and HYATT HOTELS
Assuming the 90 days horizon BJs Wholesale Club is expected to under-perform the HYATT HOTELS. In addition to that, BJs Wholesale is 1.22 times more volatile than HYATT HOTELS A. It trades about -0.01 of its total potential returns per unit of risk. HYATT HOTELS A is currently generating about 0.01 per unit of volatility. If you would invest 14,945 in HYATT HOTELS A on October 19, 2024 and sell it today you would earn a total of 25.00 from holding HYATT HOTELS A or generate 0.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BJs Wholesale Club vs. HYATT HOTELS A
Performance |
| Timeline |
| BJs Wholesale Club |
| HYATT HOTELS A |
BJs Wholesale and HYATT HOTELS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BJs Wholesale and HYATT HOTELS
The main advantage of trading using opposite BJs Wholesale and HYATT HOTELS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BJs Wholesale 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's long position.| BJs Wholesale vs. SIDETRADE EO 1 | BJs Wholesale vs. CARSALESCOM | BJs Wholesale vs. CANON MARKETING JP | BJs Wholesale vs. Elmos Semiconductor SE |
| HYATT HOTELS vs. COMPUTERSHARE | HYATT HOTELS vs. BURLINGTON STORES | HYATT HOTELS vs. H2O Retailing | HYATT HOTELS vs. BJs Wholesale Club |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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