Correlation Between Hyatt Hotels and InterContinental

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Hyatt Hotels and InterContinental 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 Hyatt Hotels and InterContinental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyatt Hotels and InterContinental Hotels Group, you can compare the effects of market volatilities on Hyatt Hotels and InterContinental 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 Hyatt Hotels with a short position of InterContinental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyatt Hotels and InterContinental.

Diversification Opportunities for Hyatt Hotels and InterContinental

0.84
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Hyatt and InterContinental is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Hyatt Hotels and InterContinental Hotels Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InterContinental Hotels and Hyatt 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 Hyatt Hotels are associated (or correlated) with InterContinental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InterContinental Hotels has no effect on the direction of Hyatt Hotels i.e., Hyatt Hotels and InterContinental go up and down completely randomly.

Pair Corralation between Hyatt Hotels and InterContinental

Taking into account the 90-day investment horizon Hyatt Hotels is expected to generate 1.03 times more return on investment than InterContinental. However, Hyatt Hotels is 1.03 times more volatile than InterContinental Hotels Group. It trades about 0.21 of its potential returns per unit of risk. InterContinental Hotels Group is currently generating about -0.15 per unit of risk. If you would invest  15,224  in Hyatt Hotels on December 30, 2023 and sell it today you would earn a total of  738.00  from holding Hyatt Hotels or generate 4.85% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Hyatt Hotels  vs.  InterContinental Hotels Group

 Performance 
       Timeline  
Hyatt Hotels 

Risk-Adjusted Performance

14 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Hyatt Hotels are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile technical indicators, Hyatt Hotels demonstrated solid returns over the last few months and may actually be approaching a breakup point.
InterContinental Hotels 

Risk-Adjusted Performance

13 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in InterContinental Hotels Group are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical indicators, InterContinental reported solid returns over the last few months and may actually be approaching a breakup point.

Hyatt Hotels and InterContinental Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Hyatt Hotels and InterContinental

The main advantage of trading using opposite Hyatt Hotels and InterContinental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyatt Hotels position performs unexpectedly, InterContinental 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 InterContinental will offset losses from the drop in InterContinental's long position.
The idea behind Hyatt Hotels and InterContinental Hotels Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.

Other Complementary Tools

Instant Ratings
Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance
Equity Forecasting
Use basic forecasting models to generate price predictions and determine price momentum
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
Portfolio Dashboard
Portfolio dashboard that provides centralized access to all your investments
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Equity Analysis
Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities
Portfolio Analyzer
Portfolio analysis module that provides access to portfolio diagnostics and optimization engine
Funds Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
Financial Widgets
Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets
Premium Stories
Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope