Correlation Between Rayonier Advanced and Xenia Hotels
Can any of the company-specific risk be diversified away by investing in both Rayonier Advanced and Xenia 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 Rayonier Advanced and Xenia Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rayonier Advanced Materials and Xenia Hotels Resorts, you can compare the effects of market volatilities on Rayonier Advanced and Xenia 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 Rayonier Advanced with a short position of Xenia Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rayonier Advanced and Xenia Hotels.
Diversification Opportunities for Rayonier Advanced and Xenia Hotels
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Rayonier and Xenia is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Rayonier Advanced Materials and Xenia Hotels Resorts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xenia Hotels Resorts and Rayonier Advanced 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 Rayonier Advanced Materials are associated (or correlated) with Xenia Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xenia Hotels Resorts has no effect on the direction of Rayonier Advanced i.e., Rayonier Advanced and Xenia Hotels go up and down completely randomly.
Pair Corralation between Rayonier Advanced and Xenia Hotels
Assuming the 90 days horizon Rayonier Advanced Materials is expected to under-perform the Xenia Hotels. But the stock apears to be less risky and, when comparing its historical volatility, Rayonier Advanced Materials is 1.53 times less risky than Xenia Hotels. The stock trades about -0.23 of its potential returns per unit of risk. The Xenia Hotels Resorts is currently generating about -0.12 of returns per unit of risk over similar time horizon. If you would invest 1,344 in Xenia Hotels Resorts on January 14, 2025 and sell it today you would lose (484.00) from holding Xenia Hotels Resorts or give up 36.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rayonier Advanced Materials vs. Xenia Hotels Resorts
Performance |
| Timeline |
| Rayonier Advanced |
| Xenia Hotels Resorts |
Rayonier Advanced and Xenia Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rayonier Advanced and Xenia Hotels
The main advantage of trading using opposite Rayonier Advanced and Xenia Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rayonier Advanced position performs unexpectedly, Xenia 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 Xenia Hotels will offset losses from the drop in Xenia Hotels' long position.| Rayonier Advanced vs. Air Liquide SA | Rayonier Advanced vs. AIR LIQUIDE ADR | Rayonier Advanced vs. Air Products and | Rayonier Advanced vs. Shin Etsu Chemical Co |
| Xenia Hotels vs. Host Hotels Resorts | Xenia Hotels vs. Ryman Hospitality Properties | Xenia Hotels vs. Park Hotels Resorts | Xenia Hotels vs. Pebblebrook Hotel Trust |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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