Correlation Between Studio City and Hilton Grand
Can any of the company-specific risk be diversified away by investing in both Studio City and Hilton Grand 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 Studio City and Hilton Grand into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Studio City International and Hilton Grand Vacations, you can compare the effects of market volatilities on Studio City and Hilton Grand 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 Studio City with a short position of Hilton Grand. Check out your portfolio center. Please also check ongoing floating volatility patterns of Studio City and Hilton Grand.
Diversification Opportunities for Studio City and Hilton Grand
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Studio and Hilton is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Studio City International and Hilton Grand Vacations in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hilton Grand Vacations and Studio City 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 Studio City International are associated (or correlated) with Hilton Grand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hilton Grand Vacations has no effect on the direction of Studio City i.e., Studio City and Hilton Grand go up and down completely randomly.
Pair Corralation between Studio City and Hilton Grand
Considering the 90-day investment horizon Studio City International is expected to under-perform the Hilton Grand. In addition to that, Studio City is 1.16 times more volatile than Hilton Grand Vacations. It trades about -0.01 of its total potential returns per unit of risk. Hilton Grand Vacations is currently generating about 0.3 per unit of volatility. If you would invest 3,664 in Hilton Grand Vacations on August 24, 2024 and sell it today you would earn a total of 554.00 from holding Hilton Grand Vacations or generate 15.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Studio City International vs. Hilton Grand Vacations
Performance |
| Timeline |
| Studio City International |
| Hilton Grand Vacations |
Studio City and Hilton Grand Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Studio City and Hilton Grand
The main advantage of trading using opposite Studio City and Hilton Grand positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Studio City position performs unexpectedly, Hilton Grand 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 Hilton Grand will offset losses from the drop in Hilton Grand's long position.| Studio City vs. Golden Entertainment | Studio City vs. Red Rock Resorts | Studio City vs. Century Casinos | Studio City vs. Ballys Corp |
| Hilton Grand vs. Vail Resorts | Hilton Grand vs. Monarch Casino Resort | Hilton Grand vs. Playa Hotels Resorts | Hilton Grand vs. Studio City International |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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