Correlation Between Park Hotels and Superior Plus
Can any of the company-specific risk be diversified away by investing in both Park Hotels and Superior Plus 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 Park Hotels and Superior Plus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Park Hotels Resorts and Superior Plus Corp, you can compare the effects of market volatilities on Park Hotels and Superior Plus 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 Park Hotels with a short position of Superior Plus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Park Hotels and Superior Plus.
Diversification Opportunities for Park Hotels and Superior Plus
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Park and Superior is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Park Hotels Resorts and Superior Plus Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Superior Plus Corp and Park 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 Park Hotels Resorts are associated (or correlated) with Superior Plus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Superior Plus Corp has no effect on the direction of Park Hotels i.e., Park Hotels and Superior Plus go up and down completely randomly.
Pair Corralation between Park Hotels and Superior Plus
Assuming the 90 days trading horizon Park Hotels Resorts is expected to generate 0.6 times more return on investment than Superior Plus. However, Park Hotels Resorts is 1.68 times less risky than Superior Plus. It trades about 0.09 of its potential returns per unit of risk. Superior Plus Corp is currently generating about -0.04 per unit of risk. If you would invest 1,260 in Park Hotels Resorts on September 23, 2024 and sell it today you would earn a total of 100.00 from holding Park Hotels Resorts or generate 7.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Park Hotels Resorts vs. Superior Plus Corp
Performance |
| Timeline |
| Park Hotels Resorts |
| Superior Plus Corp |
Park Hotels and Superior Plus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Park Hotels and Superior Plus
The main advantage of trading using opposite Park Hotels and Superior Plus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Park Hotels position performs unexpectedly, Superior Plus 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 Superior Plus will offset losses from the drop in Superior Plus' long position.| Park Hotels vs. Federal Agricultural Mortgage | Park Hotels vs. Siamgas And Petrochemicals | Park Hotels vs. ScanSource | Park Hotels vs. Sumitomo Mitsui Construction |
| Superior Plus vs. Iberdrola SA | Superior Plus vs. Enel SpA | Superior Plus vs. Enel SpA | Superior Plus vs. National Grid PLC |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |