Correlation Between Granite Real and Playa Hotels
Can any of the company-specific risk be diversified away by investing in both Granite Real and Playa 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 Granite Real and Playa Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Granite Real Estate and Playa Hotels Resorts, you can compare the effects of market volatilities on Granite Real and Playa 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 Granite Real with a short position of Playa Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Granite Real and Playa Hotels.
Diversification Opportunities for Granite Real and Playa Hotels
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Granite and Playa is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Granite Real Estate and Playa Hotels Resorts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Playa Hotels Resorts and Granite Real 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 Granite Real Estate are associated (or correlated) with Playa Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Playa Hotels Resorts has no effect on the direction of Granite Real i.e., Granite Real and Playa Hotels go up and down completely randomly.
Pair Corralation between Granite Real and Playa Hotels
Assuming the 90 days horizon Granite Real Estate is expected to under-perform the Playa Hotels. In addition to that, Granite Real is 2.06 times more volatile than Playa Hotels Resorts. It trades about -0.02 of its total potential returns per unit of risk. Playa Hotels Resorts is currently generating about 0.34 per unit of volatility. If you would invest 1,238 in Playa Hotels Resorts on November 29, 2024 and sell it today you would earn a total of 96.00 from holding Playa Hotels Resorts or generate 7.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Granite Real Estate vs. Playa Hotels Resorts
Performance |
| Timeline |
| Granite Real Estate |
| Playa Hotels Resorts |
Granite Real and Playa Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Granite Real and Playa Hotels
The main advantage of trading using opposite Granite Real and Playa Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Granite Real position performs unexpectedly, Playa 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 Playa Hotels will offset losses from the drop in Playa Hotels' long position.| Granite Real vs. Sphere 3D Corp | Granite Real vs. Sony Group Corp | Granite Real vs. Playstudios | Granite Real vs. SmartStop Self Storage |
| Playa Hotels vs. Golden Entertainment | Playa Hotels vs. Red Rock Resorts | Playa Hotels vs. Century Casinos | Playa Hotels vs. Studio City 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |