Correlation Between Playa Hotels and Bayer AG
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By analyzing existing cross correlation between Playa Hotels Resorts and Bayer AG NA, you can compare the effects of market volatilities on Playa Hotels and Bayer AG 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 Bayer AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playa Hotels and Bayer AG.
Diversification Opportunities for Playa Hotels and Bayer AG
-0.91 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Playa and Bayer is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding Playa Hotels Resorts and Bayer AG NA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bayer AG NA 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 Bayer AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bayer AG NA has no effect on the direction of Playa Hotels i.e., Playa Hotels and Bayer AG go up and down completely randomly.
Pair Corralation between Playa Hotels and Bayer AG
Assuming the 90 days horizon Playa Hotels Resorts is expected to generate 0.88 times more return on investment than Bayer AG. However, Playa Hotels Resorts is 1.13 times less risky than Bayer AG. It trades about 0.02 of its potential returns per unit of risk. Bayer AG NA is currently generating about -0.11 per unit of risk. If you would invest 855.00 in Playa Hotels Resorts on September 2, 2024 and sell it today you would earn a total of 65.00 from holding Playa Hotels Resorts or generate 7.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Playa Hotels Resorts vs. Bayer AG NA
Performance |
| Timeline |
| Playa Hotels Resorts |
| Bayer AG NA |
Playa Hotels and Bayer AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Playa Hotels and Bayer AG
The main advantage of trading using opposite Playa Hotels and Bayer AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playa Hotels position performs unexpectedly, Bayer AG 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 Bayer AG will offset losses from the drop in Bayer AG's long position.| Playa Hotels vs. United States Steel | Playa Hotels vs. RELIANCE STEEL AL | Playa Hotels vs. Insteel Industries | Playa Hotels vs. TELES Informationstechnologien AG |
| Bayer AG vs. Eli Lilly and | Bayer AG vs. Pfizer Inc | Bayer AG vs. AstraZeneca PLC | Bayer AG vs. General Mills |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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