Correlation Between Host Hotels and WICKES GROUP
Can any of the company-specific risk be diversified away by investing in both Host Hotels and WICKES GROUP 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 Host Hotels and WICKES GROUP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Host Hotels Resorts and WICKES GROUP PLC, you can compare the effects of market volatilities on Host Hotels and WICKES GROUP 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 Host Hotels with a short position of WICKES GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Host Hotels and WICKES GROUP.
Diversification Opportunities for Host Hotels and WICKES GROUP
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Host and WICKES is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Host Hotels Resorts and WICKES GROUP PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WICKES GROUP PLC and Host 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 Host Hotels Resorts are associated (or correlated) with WICKES GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WICKES GROUP PLC has no effect on the direction of Host Hotels i.e., Host Hotels and WICKES GROUP go up and down completely randomly.
Pair Corralation between Host Hotels and WICKES GROUP
Assuming the 90 days horizon Host Hotels Resorts is expected to generate 1.08 times more return on investment than WICKES GROUP. However, Host Hotels is 1.08 times more volatile than WICKES GROUP PLC. It trades about 0.16 of its potential returns per unit of risk. WICKES GROUP PLC is currently generating about 0.01 per unit of risk. If you would invest 1,670 in Host Hotels Resorts on September 12, 2024 and sell it today you would earn a total of 80.00 from holding Host Hotels Resorts or generate 4.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Host Hotels Resorts vs. WICKES GROUP PLC
Performance |
| Timeline |
| Host Hotels Resorts |
| WICKES GROUP PLC |
Host Hotels and WICKES GROUP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Host Hotels and WICKES GROUP
The main advantage of trading using opposite Host Hotels and WICKES GROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Host Hotels position performs unexpectedly, WICKES GROUP 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 WICKES GROUP will offset losses from the drop in WICKES GROUP's long position.| Host Hotels vs. Sunstone Hotel Investors | Host Hotels vs. Xenia Hotels Resorts | Host Hotels vs. Summit Hotel Properties | Host Hotels vs. ASHFORD HOSPITTRUST |
| WICKES GROUP vs. Perseus Mining Limited | WICKES GROUP vs. Jacquet Metal Service | WICKES GROUP vs. Pebblebrook Hotel Trust | WICKES GROUP vs. Host 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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