Correlation Between Playa Hotels and Oasis Hotel
Can any of the company-specific risk be diversified away by investing in both Playa Hotels and Oasis Hotel 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 Oasis Hotel 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 Oasis Hotel Resort, you can compare the effects of market volatilities on Playa Hotels and Oasis Hotel 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 Oasis Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playa Hotels and Oasis Hotel.
Diversification Opportunities for Playa Hotels and Oasis Hotel
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Playa and Oasis is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Playa Hotels Resorts and Oasis Hotel Resort in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oasis Hotel Resort 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 Oasis Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oasis Hotel Resort has no effect on the direction of Playa Hotels i.e., Playa Hotels and Oasis Hotel go up and down completely randomly.
Pair Corralation between Playa Hotels and Oasis Hotel
If you would invest 873.00 in Playa Hotels Resorts on August 30, 2024 and sell it today you would earn a total of 96.00 from holding Playa Hotels Resorts or generate 11.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Playa Hotels Resorts vs. Oasis Hotel Resort
Performance |
| Timeline |
| Playa Hotels Resorts |
| Oasis Hotel Resort |
Playa Hotels and Oasis Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Playa Hotels and Oasis Hotel
The main advantage of trading using opposite Playa Hotels and Oasis Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playa Hotels position performs unexpectedly, Oasis Hotel 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 Oasis Hotel will offset losses from the drop in Oasis Hotel's long position.| Playa Hotels vs. Yatra Online | Playa Hotels vs. Despegar Corp | Playa Hotels vs. Mondee Holdings | Playa Hotels vs. MakeMyTrip Limited |
| Oasis Hotel vs. Apple Inc | Oasis Hotel vs. Microsoft | Oasis Hotel vs. Alphabet Inc Class C | Oasis Hotel vs. Meta Platforms |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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