Correlation Between REGAL HOTEL and Apple
Can any of the company-specific risk be diversified away by investing in both REGAL HOTEL and Apple 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 Apple 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 Apple Inc, you can compare the effects of market volatilities on REGAL HOTEL and Apple 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 Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of REGAL HOTEL and Apple.
Diversification Opportunities for REGAL HOTEL and Apple
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between REGAL and Apple is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding REGAL HOTEL INTL and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc 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 Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of REGAL HOTEL i.e., REGAL HOTEL and Apple go up and down completely randomly.
Pair Corralation between REGAL HOTEL and Apple
Assuming the 90 days trading horizon REGAL HOTEL is expected to generate 21.76 times less return on investment than Apple. In addition to that, REGAL HOTEL is 1.16 times more volatile than Apple Inc. It trades about 0.01 of its total potential returns per unit of risk. Apple Inc is currently generating about 0.19 per unit of volatility. If you would invest 21,185 in Apple Inc on August 31, 2024 and sell it today you would earn a total of 1,125 from holding Apple Inc or generate 5.31% 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. Apple Inc
Performance |
| Timeline |
| REGAL HOTEL INTL |
| Apple Inc |
REGAL HOTEL and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with REGAL HOTEL and Apple
The main advantage of trading using opposite REGAL HOTEL and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if REGAL HOTEL position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple's long position.| REGAL HOTEL vs. Webster Financial | REGAL HOTEL vs. OFFICE DEPOT | REGAL HOTEL vs. Haier Smart Home | REGAL HOTEL vs. National Bank Holdings |
| Apple vs. NTG Nordic Transport | Apple vs. COPLAND ROAD CAPITAL | Apple vs. SBA Communications Corp | Apple vs. T Mobile |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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