Correlation Between Booking Holdings and Trip Group
Can any of the company-specific risk be diversified away by investing in both Booking Holdings and Trip Group 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 Booking Holdings and Trip Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Booking Holdings and Trip Group Limited, you can compare the effects of market volatilities on Booking Holdings and Trip Group 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 Booking Holdings with a short position of Trip Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Booking Holdings and Trip Group.
Diversification Opportunities for Booking Holdings and Trip Group
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Booking and Trip is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Booking Holdings and Trip Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trip Group Limited and Booking Holdings 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 Booking Holdings are associated (or correlated) with Trip Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trip Group Limited has no effect on the direction of Booking Holdings i.e., Booking Holdings and Trip Group go up and down completely randomly.
Pair Corralation between Booking Holdings and Trip Group
If you would invest 474,911 in Booking Holdings on September 2, 2024 and sell it today you would earn a total of 45,287 from holding Booking Holdings or generate 9.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Booking Holdings vs. Trip Group Limited
Performance |
| Timeline |
| Booking Holdings |
| Trip Group Limited |
Booking Holdings and Trip Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Booking Holdings and Trip Group
The main advantage of trading using opposite Booking Holdings and Trip Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Booking Holdings position performs unexpectedly, Trip Group 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 Trip Group will offset losses from the drop in Trip Group's long position.| Booking Holdings vs. TripAdvisor | Booking Holdings vs. Airbnb Inc | Booking Holdings vs. Royal Caribbean Cruises | Booking Holdings vs. Norwegian Cruise Line |
| Trip Group vs. Amadeus IT Holding | Trip Group vs. Yatra Online | Trip Group vs. MakeMyTrip Limited | Trip Group vs. Tuniu Corp |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |