Correlation Between Playa Hotels and AGRICUL BK
Can any of the company-specific risk be diversified away by investing in both Playa Hotels and AGRICUL BK 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 AGRICUL BK 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 AGRICUL BK CHINA H , you can compare the effects of market volatilities on Playa Hotels and AGRICUL BK 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 AGRICUL BK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playa Hotels and AGRICUL BK.
Diversification Opportunities for Playa Hotels and AGRICUL BK
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Playa and AGRICUL is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Playa Hotels Resorts and AGRICUL BK CHINA H in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGRICUL BK CHINA 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 AGRICUL BK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGRICUL BK CHINA has no effect on the direction of Playa Hotels i.e., Playa Hotels and AGRICUL BK go up and down completely randomly.
Pair Corralation between Playa Hotels and AGRICUL BK
Assuming the 90 days horizon Playa Hotels is expected to generate 1.14 times less return on investment than AGRICUL BK. But when comparing it to its historical volatility, Playa Hotels Resorts is 1.01 times less risky than AGRICUL BK. It trades about 0.07 of its potential returns per unit of risk. AGRICUL BK CHINA H is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 38.00 in AGRICUL BK CHINA H on September 3, 2024 and sell it today you would earn a total of 8.00 from holding AGRICUL BK CHINA H or generate 21.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Playa Hotels Resorts vs. AGRICUL BK CHINA H
Performance |
| Timeline |
| Playa Hotels Resorts |
| AGRICUL BK CHINA |
Playa Hotels and AGRICUL BK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Playa Hotels and AGRICUL BK
The main advantage of trading using opposite Playa Hotels and AGRICUL BK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playa Hotels position performs unexpectedly, AGRICUL BK 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 AGRICUL BK will offset losses from the drop in AGRICUL BK's long position.| Playa Hotels vs. SBA Communications Corp | Playa Hotels vs. Datadog | Playa Hotels vs. Consolidated Communications Holdings | Playa Hotels vs. Ribbon Communications |
| AGRICUL BK vs. ANTA SPORTS PRODUCT | AGRICUL BK vs. Perseus Mining Limited | AGRICUL BK vs. Jacquet Metal Service | AGRICUL BK vs. Playa 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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