Correlation Between Hyatt Hotels and PlayAGS
Can any of the company-specific risk be diversified away by investing in both Hyatt Hotels and PlayAGS 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 Hyatt Hotels and PlayAGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyatt Hotels and PlayAGS, you can compare the effects of market volatilities on Hyatt Hotels and PlayAGS 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 Hyatt Hotels with a short position of PlayAGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyatt Hotels and PlayAGS.
Diversification Opportunities for Hyatt Hotels and PlayAGS
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hyatt and PlayAGS is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Hyatt Hotels and PlayAGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PlayAGS and Hyatt Hotels 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 Hyatt Hotels are associated (or correlated) with PlayAGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PlayAGS has no effect on the direction of Hyatt Hotels i.e., Hyatt Hotels and PlayAGS go up and down completely randomly.
Pair Corralation between Hyatt Hotels and PlayAGS
Taking into account the 90-day investment horizon Hyatt Hotels is expected to generate 10.17 times more return on investment than PlayAGS. However, Hyatt Hotels is 10.17 times more volatile than PlayAGS. It trades about 0.22 of its potential returns per unit of risk. PlayAGS is currently generating about -0.07 per unit of risk. If you would invest 14,293 in Hyatt Hotels on September 4, 2024 and sell it today you would earn a total of 1,328 from holding Hyatt Hotels or generate 9.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Hyatt Hotels vs. PlayAGS
Performance |
| Timeline |
| Hyatt Hotels |
| PlayAGS |
Hyatt Hotels and PlayAGS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyatt Hotels and PlayAGS
The main advantage of trading using opposite Hyatt Hotels and PlayAGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyatt Hotels position performs unexpectedly, PlayAGS 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 PlayAGS will offset losses from the drop in PlayAGS's long position.| Hyatt Hotels vs. Marriott International | Hyatt Hotels vs. InterContinental Hotels Group | Hyatt Hotels vs. Choice Hotels International | Hyatt Hotels vs. Wyndham Hotels Resorts |
| PlayAGS vs. Hyatt Hotels | PlayAGS vs. Smart Share Global | PlayAGS vs. Sweetgreen | PlayAGS vs. Wyndham Hotels Resorts |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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