Correlation Between Hyatt Hotels and Nova Lifestyle
Can any of the company-specific risk be diversified away by investing in both Hyatt Hotels and Nova Lifestyle 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 Nova Lifestyle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyatt Hotels and Nova Lifestyle I, you can compare the effects of market volatilities on Hyatt Hotels and Nova Lifestyle 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 Nova Lifestyle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyatt Hotels and Nova Lifestyle.
Diversification Opportunities for Hyatt Hotels and Nova Lifestyle
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hyatt and Nova is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Hyatt Hotels and Nova Lifestyle I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nova Lifestyle I 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 Nova Lifestyle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nova Lifestyle I has no effect on the direction of Hyatt Hotels i.e., Hyatt Hotels and Nova Lifestyle go up and down completely randomly.
Pair Corralation between Hyatt Hotels and Nova Lifestyle
Taking into account the 90-day investment horizon Hyatt Hotels is expected to generate 0.34 times more return on investment than Nova Lifestyle. However, Hyatt Hotels is 2.98 times less risky than Nova Lifestyle. It trades about 0.01 of its potential returns per unit of risk. Nova Lifestyle I is currently generating about -0.46 per unit of risk. If you would invest 15,640 in Hyatt Hotels on August 30, 2024 and sell it today you would lose (29.00) from holding Hyatt Hotels or give up 0.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyatt Hotels vs. Nova Lifestyle I
Performance |
| Timeline |
| Hyatt Hotels |
| Nova Lifestyle I |
Hyatt Hotels and Nova Lifestyle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyatt Hotels and Nova Lifestyle
The main advantage of trading using opposite Hyatt Hotels and Nova Lifestyle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyatt Hotels position performs unexpectedly, Nova Lifestyle 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 Nova Lifestyle will offset losses from the drop in Nova Lifestyle'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 |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |