Correlation Between Playa Hotels and PT Global
Can any of the company-specific risk be diversified away by investing in both Playa Hotels and PT Global 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 Playa Hotels and PT Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Playa Hotels Resorts and PT Global Mediacom, you can compare the effects of market volatilities on Playa Hotels and PT Global 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 Playa Hotels with a short position of PT Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playa Hotels and PT Global.
Diversification Opportunities for Playa Hotels and PT Global
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Playa and 06L is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Playa Hotels Resorts and PT Global Mediacom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Global Mediacom and Playa 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 Playa Hotels Resorts are associated (or correlated) with PT Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Global Mediacom has no effect on the direction of Playa Hotels i.e., Playa Hotels and PT Global go up and down completely randomly.
Pair Corralation between Playa Hotels and PT Global
If you would invest 775.00 in Playa Hotels Resorts on September 1, 2024 and sell it today you would earn a total of 135.00 from holding Playa Hotels Resorts or generate 17.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Playa Hotels Resorts vs. PT Global Mediacom
Performance |
| Timeline |
| Playa Hotels Resorts |
| PT Global Mediacom |
Playa Hotels and PT Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Playa Hotels and PT Global
The main advantage of trading using opposite Playa Hotels and PT Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playa Hotels position performs unexpectedly, PT Global 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 PT Global will offset losses from the drop in PT Global's long position.| Playa Hotels vs. JJ SNACK FOODS | Playa Hotels vs. Suntory Beverage Food | Playa Hotels vs. Treasury Wine Estates | Playa Hotels vs. MOLSON RS BEVERAGE |
| PT Global vs. Netflix | PT Global vs. Warner Music Group | PT Global vs. Superior Plus Corp | PT Global vs. NMI Holdings |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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