Correlation Between Playa Hotels and One Group
Can any of the company-specific risk be diversified away by investing in both Playa Hotels and One Group 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 One Group 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 One Group Hospitality, you can compare the effects of market volatilities on Playa Hotels and One Group 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 One Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playa Hotels and One Group.
Diversification Opportunities for Playa Hotels and One Group
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Playa and One is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Playa Hotels Resorts and One Group Hospitality in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on One Group Hospitality 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 One Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of One Group Hospitality has no effect on the direction of Playa Hotels i.e., Playa Hotels and One Group go up and down completely randomly.
Pair Corralation between Playa Hotels and One Group
Given the investment horizon of 90 days Playa Hotels Resorts is expected to generate 0.42 times more return on investment than One Group. However, Playa Hotels Resorts is 2.39 times less risky than One Group. It trades about 0.29 of its potential returns per unit of risk. One Group Hospitality is currently generating about 0.03 per unit of risk. If you would invest 872.00 in Playa Hotels Resorts on August 28, 2024 and sell it today you would earn a total of 118.00 from holding Playa Hotels Resorts or generate 13.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Playa Hotels Resorts vs. One Group Hospitality
Performance |
| Timeline |
| Playa Hotels Resorts |
| One Group Hospitality |
Playa Hotels and One Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Playa Hotels and One Group
The main advantage of trading using opposite Playa Hotels and One Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playa Hotels position performs unexpectedly, One Group 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 One Group will offset losses from the drop in One Group's long position.| Playa Hotels vs. Yatra Online | Playa Hotels vs. Mondee Holdings | Playa Hotels vs. TripAdvisor | Playa Hotels vs. Thayer Ventures Acquisition |
| One Group vs. FAT Brands | One Group vs. Potbelly Co | One Group vs. BJs Restaurants | One Group vs. Rave Restaurant Group |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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