Correlation Between Gaztransport Technigaz and PPHE HOTEL
Can any of the company-specific risk be diversified away by investing in both Gaztransport Technigaz 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 Gaztransport Technigaz and PPHE HOTEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaztransport Technigaz SA and PPHE HOTEL GROUP, you can compare the effects of market volatilities on Gaztransport Technigaz 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 Gaztransport Technigaz with a short position of PPHE HOTEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport Technigaz and PPHE HOTEL.
Diversification Opportunities for Gaztransport Technigaz and PPHE HOTEL
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gaztransport and PPHE is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport Technigaz SA 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 Gaztransport Technigaz 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 Gaztransport Technigaz SA 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 Gaztransport Technigaz i.e., Gaztransport Technigaz and PPHE HOTEL go up and down completely randomly.
Pair Corralation between Gaztransport Technigaz and PPHE HOTEL
Assuming the 90 days horizon Gaztransport Technigaz is expected to generate 1.33 times less return on investment than PPHE HOTEL. In addition to that, Gaztransport Technigaz is 2.11 times more volatile than PPHE HOTEL GROUP. It trades about 0.17 of its total potential returns per unit of risk. PPHE HOTEL GROUP is currently generating about 0.47 per unit of volatility. If you would invest 1,570 in PPHE HOTEL GROUP on October 11, 2024 and sell it today you would earn a total of 130.00 from holding PPHE HOTEL GROUP or generate 8.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaztransport Technigaz SA vs. PPHE HOTEL GROUP
Performance |
| Timeline |
| Gaztransport Technigaz |
| PPHE HOTEL GROUP |
Gaztransport Technigaz and PPHE HOTEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport Technigaz and PPHE HOTEL
The main advantage of trading using opposite Gaztransport Technigaz and PPHE HOTEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport Technigaz 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.| Gaztransport Technigaz vs. REVO INSURANCE SPA | Gaztransport Technigaz vs. Webster Financial | Gaztransport Technigaz vs. NORTHEAST UTILITIES | Gaztransport Technigaz vs. Commonwealth Bank of |
| 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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