Correlation Between Hilton Worldwide and Lufax Holding
Can any of the company-specific risk be diversified away by investing in both Hilton Worldwide and Lufax Holding 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 Hilton Worldwide and Lufax Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hilton Worldwide Holdings and Lufax Holding, you can compare the effects of market volatilities on Hilton Worldwide and Lufax Holding 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 Hilton Worldwide with a short position of Lufax Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hilton Worldwide and Lufax Holding.
Diversification Opportunities for Hilton Worldwide and Lufax Holding
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hilton and Lufax is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Hilton Worldwide Holdings and Lufax Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lufax Holding and Hilton Worldwide 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 Hilton Worldwide Holdings are associated (or correlated) with Lufax Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lufax Holding has no effect on the direction of Hilton Worldwide i.e., Hilton Worldwide and Lufax Holding go up and down completely randomly.
Pair Corralation between Hilton Worldwide and Lufax Holding
Considering the 90-day investment horizon Hilton Worldwide Holdings is expected to under-perform the Lufax Holding. But the stock apears to be less risky and, when comparing its historical volatility, Hilton Worldwide Holdings is 2.44 times less risky than Lufax Holding. The stock trades about -0.07 of its potential returns per unit of risk. The Lufax Holding is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 246.00 in Lufax Holding on October 21, 2024 and sell it today you would earn a total of 6.00 from holding Lufax Holding or generate 2.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hilton Worldwide Holdings vs. Lufax Holding
Performance |
| Timeline |
| Hilton Worldwide Holdings |
| Lufax Holding |
Hilton Worldwide and Lufax Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hilton Worldwide and Lufax Holding
The main advantage of trading using opposite Hilton Worldwide and Lufax Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hilton Worldwide position performs unexpectedly, Lufax Holding 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 Lufax Holding will offset losses from the drop in Lufax Holding's long position.| Hilton Worldwide vs. Hyatt Hotels | Hilton Worldwide vs. Wyndham Hotels Resorts | Hilton Worldwide vs. Choice Hotels International | Hilton Worldwide vs. InterContinental Hotels Group |
| Lufax Holding vs. 360 Finance | Lufax Holding vs. FinVolution Group | Lufax Holding vs. Qudian Inc | Lufax Holding vs. X Financial Class |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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