Correlation Between Wyndham Hotels and Shangri-La Asia
Can any of the company-specific risk be diversified away by investing in both Wyndham Hotels and Shangri-La Asia 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 Wyndham Hotels and Shangri-La Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wyndham Hotels Resorts and Shangri La Asia Limited, you can compare the effects of market volatilities on Wyndham Hotels and Shangri-La Asia 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 Wyndham Hotels with a short position of Shangri-La Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wyndham Hotels and Shangri-La Asia.
Diversification Opportunities for Wyndham Hotels and Shangri-La Asia
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wyndham and Shangri-La is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Wyndham Hotels Resorts and Shangri La Asia Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shangri La Asia and Wyndham 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 Wyndham Hotels Resorts are associated (or correlated) with Shangri-La Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shangri La Asia has no effect on the direction of Wyndham Hotels i.e., Wyndham Hotels and Shangri-La Asia go up and down completely randomly.
Pair Corralation between Wyndham Hotels and Shangri-La Asia
If you would invest 8,832 in Wyndham Hotels Resorts on September 1, 2024 and sell it today you would earn a total of 986.00 from holding Wyndham Hotels Resorts or generate 11.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Wyndham Hotels Resorts vs. Shangri La Asia Limited
Performance |
| Timeline |
| Wyndham Hotels Resorts |
| Shangri La Asia |
Wyndham Hotels and Shangri-La Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wyndham Hotels and Shangri-La Asia
The main advantage of trading using opposite Wyndham Hotels and Shangri-La Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wyndham Hotels position performs unexpectedly, Shangri-La Asia 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 Shangri-La Asia will offset losses from the drop in Shangri-La Asia's long position.| Wyndham Hotels vs. InterContinental Hotels Group | Wyndham Hotels vs. Hyatt Hotels | Wyndham Hotels vs. Hilton Worldwide Holdings | Wyndham Hotels vs. Marriott International |
| Shangri-La Asia vs. Marriott International | Shangri-La Asia vs. Hilton Worldwide Holdings | Shangri-La Asia vs. InterContinental Hotels Group | Shangri-La Asia vs. InterContinental Hotels 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |