Correlation Between REGAL HOTEL and BRAEMAR HOTELS
Can any of the company-specific risk be diversified away by investing in both REGAL HOTEL and BRAEMAR HOTELS 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 REGAL HOTEL and BRAEMAR HOTELS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between REGAL HOTEL INTL and BRAEMAR HOTELS RES, you can compare the effects of market volatilities on REGAL HOTEL and BRAEMAR HOTELS 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 REGAL HOTEL with a short position of BRAEMAR HOTELS. Check out your portfolio center. Please also check ongoing floating volatility patterns of REGAL HOTEL and BRAEMAR HOTELS.
Diversification Opportunities for REGAL HOTEL and BRAEMAR HOTELS
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between REGAL and BRAEMAR is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding REGAL HOTEL INTL and BRAEMAR HOTELS RES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BRAEMAR HOTELS RES and REGAL HOTEL 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 REGAL HOTEL INTL are associated (or correlated) with BRAEMAR HOTELS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BRAEMAR HOTELS RES has no effect on the direction of REGAL HOTEL i.e., REGAL HOTEL and BRAEMAR HOTELS go up and down completely randomly.
Pair Corralation between REGAL HOTEL and BRAEMAR HOTELS
Assuming the 90 days trading horizon REGAL HOTEL INTL is expected to generate 0.9 times more return on investment than BRAEMAR HOTELS. However, REGAL HOTEL INTL is 1.11 times less risky than BRAEMAR HOTELS. It trades about 0.08 of its potential returns per unit of risk. BRAEMAR HOTELS RES is currently generating about -0.19 per unit of risk. If you would invest 28.00 in REGAL HOTEL INTL on October 10, 2024 and sell it today you would earn a total of 1.00 from holding REGAL HOTEL INTL or generate 3.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
REGAL HOTEL INTL vs. BRAEMAR HOTELS RES
Performance |
| Timeline |
| REGAL HOTEL INTL |
| BRAEMAR HOTELS RES |
REGAL HOTEL and BRAEMAR HOTELS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with REGAL HOTEL and BRAEMAR HOTELS
The main advantage of trading using opposite REGAL HOTEL and BRAEMAR HOTELS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if REGAL HOTEL position performs unexpectedly, BRAEMAR HOTELS 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 BRAEMAR HOTELS will offset losses from the drop in BRAEMAR HOTELS's long position.| REGAL HOTEL vs. Insteel Industries | REGAL HOTEL vs. Constellation Software | REGAL HOTEL vs. Unity Software | REGAL HOTEL vs. Magic Software Enterprises |
| BRAEMAR HOTELS vs. PARKEN Sport Entertainment | BRAEMAR HOTELS vs. ARDAGH METAL PACDL 0001 | BRAEMAR HOTELS vs. Osisko Metals | BRAEMAR HOTELS vs. UPDATE SOFTWARE |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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