Correlation Between COPLAND ROAD and PPHE HOTEL
Can any of the company-specific risk be diversified away by investing in both COPLAND ROAD 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 COPLAND ROAD and PPHE HOTEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COPLAND ROAD CAPITAL and PPHE HOTEL GROUP, you can compare the effects of market volatilities on COPLAND ROAD 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 COPLAND ROAD with a short position of PPHE HOTEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of COPLAND ROAD and PPHE HOTEL.
Diversification Opportunities for COPLAND ROAD and PPHE HOTEL
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between COPLAND and PPHE is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding COPLAND ROAD CAPITAL 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 COPLAND ROAD 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 COPLAND ROAD CAPITAL 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 COPLAND ROAD i.e., COPLAND ROAD and PPHE HOTEL go up and down completely randomly.
Pair Corralation between COPLAND ROAD and PPHE HOTEL
Assuming the 90 days horizon COPLAND ROAD CAPITAL is expected to generate 1.64 times more return on investment than PPHE HOTEL. However, COPLAND ROAD is 1.64 times more volatile than PPHE HOTEL GROUP. It trades about 0.24 of its potential returns per unit of risk. PPHE HOTEL GROUP is currently generating about -0.23 per unit of risk. If you would invest 4,535 in COPLAND ROAD CAPITAL on October 26, 2024 and sell it today you would earn a total of 775.00 from holding COPLAND ROAD CAPITAL or generate 17.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
COPLAND ROAD CAPITAL vs. PPHE HOTEL GROUP
Performance |
| Timeline |
| COPLAND ROAD CAPITAL |
| PPHE HOTEL GROUP |
COPLAND ROAD and PPHE HOTEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COPLAND ROAD and PPHE HOTEL
The main advantage of trading using opposite COPLAND ROAD and PPHE HOTEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COPLAND ROAD 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.| COPLAND ROAD vs. LIVZON PHARMAC GRP | COPLAND ROAD vs. CanSino Biologics | COPLAND ROAD vs. Superior Plus Corp | COPLAND ROAD vs. Origin Agritech |
| PPHE HOTEL vs. CITY OFFICE REIT | PPHE HOTEL vs. Tower One Wireless | PPHE HOTEL vs. SLR Investment Corp | PPHE HOTEL vs. ECHO INVESTMENT ZY |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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