Correlation Between Compagnie Plastic and Hyatt Hotels
Can any of the company-specific risk be diversified away by investing in both Compagnie Plastic 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 Compagnie Plastic and Hyatt Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Compagnie Plastic Omnium and Hyatt Hotels, you can compare the effects of market volatilities on Compagnie Plastic 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 Compagnie Plastic with a short position of Hyatt Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compagnie Plastic and Hyatt Hotels.
Diversification Opportunities for Compagnie Plastic and Hyatt Hotels
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Compagnie and Hyatt is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Compagnie Plastic Omnium and Hyatt Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyatt Hotels and Compagnie Plastic 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 Compagnie Plastic Omnium 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 Compagnie Plastic i.e., Compagnie Plastic and Hyatt Hotels go up and down completely randomly.
Pair Corralation between Compagnie Plastic and Hyatt Hotels
Assuming the 90 days horizon Compagnie Plastic Omnium is expected to under-perform the Hyatt Hotels. In addition to that, Compagnie Plastic is 1.33 times more volatile than Hyatt Hotels. It trades about -0.02 of its total potential returns per unit of risk. Hyatt Hotels is currently generating about 0.04 per unit of volatility. If you would invest 9,769 in Hyatt Hotels on December 7, 2024 and sell it today you would earn a total of 3,136 from holding Hyatt Hotels or generate 32.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Compagnie Plastic Omnium vs. Hyatt Hotels
Performance |
| Timeline |
| Compagnie Plastic Omnium |
| Hyatt Hotels |
Compagnie Plastic and Hyatt Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compagnie Plastic and Hyatt Hotels
The main advantage of trading using opposite Compagnie Plastic and Hyatt Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compagnie Plastic 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.| Compagnie Plastic vs. Geely Automobile Holdings | Compagnie Plastic vs. NEWELL RUBBERMAID | Compagnie Plastic vs. Rayonier Advanced Materials | Compagnie Plastic vs. COMMERCIAL VEHICLE |
| Hyatt Hotels vs. PEPTONIC MEDICAL | Hyatt Hotels vs. Guangdong Investment Limited | Hyatt Hotels vs. PennantPark Investment | Hyatt Hotels vs. CHRYSALIS INVESTMENTS LTD |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |