Correlation Between Sands China and Banyan Tree
Can any of the company-specific risk be diversified away by investing in both Sands China and Banyan Tree 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 Sands China and Banyan Tree into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sands China and Banyan Tree Holdings, you can compare the effects of market volatilities on Sands China and Banyan Tree 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 Sands China with a short position of Banyan Tree. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sands China and Banyan Tree.
Diversification Opportunities for Sands China and Banyan Tree
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sands and Banyan is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Sands China and Banyan Tree Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banyan Tree Holdings and Sands China 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 Sands China are associated (or correlated) with Banyan Tree. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banyan Tree Holdings has no effect on the direction of Sands China i.e., Sands China and Banyan Tree go up and down completely randomly.
Pair Corralation between Sands China and Banyan Tree
If you would invest 236.00 in Sands China on August 25, 2024 and sell it today you would earn a total of 17.00 from holding Sands China or generate 7.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sands China vs. Banyan Tree Holdings
Performance |
| Timeline |
| Sands China |
| Banyan Tree Holdings |
Sands China and Banyan Tree Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sands China and Banyan Tree
The main advantage of trading using opposite Sands China and Banyan Tree positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sands China position performs unexpectedly, Banyan Tree 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 Banyan Tree will offset losses from the drop in Banyan Tree's long position.| Sands China vs. Las Vegas Sands | Sands China vs. MGM Resorts International | Sands China vs. Caesars Entertainment | Sands China vs. Wynn Resorts Limited |
| Banyan Tree vs. SJM Holdings Ltd | Banyan Tree vs. Studio City International | Banyan Tree vs. Monarch Casino Resort | Banyan Tree vs. Playa Hotels Resorts |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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