Correlation Between Dutch Bros and Hyatt Hotels
Can any of the company-specific risk be diversified away by investing in both Dutch Bros 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 Dutch Bros and Hyatt Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dutch Bros and Hyatt Hotels, you can compare the effects of market volatilities on Dutch Bros 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 Dutch Bros with a short position of Hyatt Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dutch Bros and Hyatt Hotels.
Diversification Opportunities for Dutch Bros and Hyatt Hotels
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dutch and Hyatt is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Dutch Bros and Hyatt Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyatt Hotels and Dutch Bros 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 Dutch Bros 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 has no effect on the direction of Dutch Bros i.e., Dutch Bros and Hyatt Hotels go up and down completely randomly.
Pair Corralation between Dutch Bros and Hyatt Hotels
Given the investment horizon of 90 days Dutch Bros is expected to generate 1.42 times more return on investment than Hyatt Hotels. However, Dutch Bros is 1.42 times more volatile than Hyatt Hotels. It trades about 0.16 of its potential returns per unit of risk. Hyatt Hotels is currently generating about 0.04 per unit of risk. If you would invest 4,844 in Dutch Bros on September 12, 2024 and sell it today you would earn a total of 354.00 from holding Dutch Bros or generate 7.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dutch Bros vs. Hyatt Hotels
Performance |
| Timeline |
| Dutch Bros |
| Hyatt Hotels |
Dutch Bros and Hyatt Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dutch Bros and Hyatt Hotels
The main advantage of trading using opposite Dutch Bros and Hyatt Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dutch Bros 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' long position.| Dutch Bros vs. Starbucks | Dutch Bros vs. CAVA Group, | Dutch Bros vs. Yum China Holdings | Dutch Bros vs. Wingstop |
| Hyatt Hotels vs. InterContinental Hotels Group | Hyatt Hotels vs. Hilton Worldwide Holdings | Hyatt Hotels vs. Marriott International | Hyatt Hotels vs. Choice Hotels International |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |