Correlation Between GreenTree Hospitality and Atour Lifestyle

Can any of the company-specific risk be diversified away by investing in both GreenTree Hospitality and Atour Lifestyle 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 GreenTree Hospitality and Atour Lifestyle into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GreenTree Hospitality Group and Atour Lifestyle Holdings, you can compare the effects of market volatilities on GreenTree Hospitality and Atour Lifestyle 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 GreenTree Hospitality with a short position of Atour Lifestyle. Check out your portfolio center. Please also check ongoing floating volatility patterns of GreenTree Hospitality and Atour Lifestyle.

Diversification Opportunities for GreenTree Hospitality and Atour Lifestyle

0.48

Correlation Coefficient

GreenTree Hospitality  Atour Lifestyle

Very weak diversification

The 3 months correlation between GreenTree and Atour is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding GreenTree Hospitality Group and Atour Lifestyle Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atour Lifestyle Holdings and GreenTree Hospitality 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 GreenTree Hospitality Group are associated (or correlated) with Atour Lifestyle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atour Lifestyle Holdings has no effect on the direction of GreenTree Hospitality i.e., GreenTree Hospitality and Atour Lifestyle go up and down completely randomly.

Pair Corralation between GreenTree Hospitality and Atour Lifestyle

Considering the 90-day investment horizon GreenTree Hospitality is expected to generate 1.87 times less return on investment than Atour Lifestyle. In addition to that, GreenTree Hospitality is 1.55 times more volatile than Atour Lifestyle Holdings. It trades about 0.11 of its total potential returns per unit of risk. Atour Lifestyle Holdings is currently generating about 0.32 per unit of volatility. If you would invest  2,345  in Atour Lifestyle Holdings on April 24, 2025 and sell it today you would earn a total of  1,281  from holding Atour Lifestyle Holdings or generate 54.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

GreenTree Hospitality Group  vs.  Atour Lifestyle Holdings

GreenTree Hospitality

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in GreenTree Hospitality Group are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent technical indicators, GreenTree Hospitality reported solid returns over the last few months and may actually be approaching a breakup point.

Atour Lifestyle Holdings

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Atour Lifestyle Holdings are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, Atour Lifestyle unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GreenTree Hospitality and Atour Lifestyle

The main advantage of trading using opposite GreenTree Hospitality and Atour Lifestyle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GreenTree Hospitality position performs unexpectedly, Atour Lifestyle 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 Atour Lifestyle will offset losses from the drop in Atour Lifestyle's long position.

The idea behind GreenTree Hospitality Group and Atour Lifestyle Holdings 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.

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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.