Correlation Between Getty Realty and Park Hotels
Can any of the company-specific risk be diversified away by investing in both Getty Realty and Park 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 Getty Realty and Park Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Getty Realty and Park Hotels Resorts, you can compare the effects of market volatilities on Getty Realty and Park 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 Getty Realty with a short position of Park Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Getty Realty and Park Hotels.
Diversification Opportunities for Getty Realty and Park Hotels
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Getty and Park is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Getty Realty and Park Hotels Resorts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Park Hotels Resorts and Getty Realty 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 Getty Realty are associated (or correlated) with Park Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Park Hotels Resorts has no effect on the direction of Getty Realty i.e., Getty Realty and Park Hotels go up and down completely randomly.
Pair Corralation between Getty Realty and Park Hotels
Considering the 90-day investment horizon Getty Realty is expected to generate 2.52 times less return on investment than Park Hotels. But when comparing it to its historical volatility, Getty Realty is 1.63 times less risky than Park Hotels. It trades about 0.19 of its potential returns per unit of risk. Park Hotels Resorts is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 1,384 in Park Hotels Resorts on September 2, 2024 and sell it today you would earn a total of 171.00 from holding Park Hotels Resorts or generate 12.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Getty Realty vs. Park Hotels Resorts
Performance |
| Timeline |
| Getty Realty |
| Park Hotels Resorts |
Getty Realty and Park Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Getty Realty and Park Hotels
The main advantage of trading using opposite Getty Realty and Park Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Getty Realty position performs unexpectedly, Park 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 Park Hotels will offset losses from the drop in Park Hotels' long position.| Getty Realty vs. Federal Realty Investment | Getty Realty vs. National Retail Properties | Getty Realty vs. Kimco Realty |
| Park Hotels vs. Diamondrock Hospitality | Park Hotels vs. Ryman Hospitality Properties | Park Hotels vs. Service Properties Trust | Park Hotels vs. RLJ Lodging Trust |
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.
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