Correlation Between Hilton Worldwide and Expedia
Can any of the company-specific risk be diversified away by investing in both Hilton Worldwide and Expedia 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 Hilton Worldwide and Expedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hilton Worldwide Holdings and Expedia Group, you can compare the effects of market volatilities on Hilton Worldwide and Expedia 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 Hilton Worldwide with a short position of Expedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hilton Worldwide and Expedia.
Diversification Opportunities for Hilton Worldwide and Expedia
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hilton and Expedia is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Hilton Worldwide Holdings and Expedia Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Expedia Group and Hilton Worldwide 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 Hilton Worldwide Holdings are associated (or correlated) with Expedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Expedia Group has no effect on the direction of Hilton Worldwide i.e., Hilton Worldwide and Expedia go up and down completely randomly.
Pair Corralation between Hilton Worldwide and Expedia
Considering the 90-day investment horizon Hilton Worldwide Holdings is expected to under-perform the Expedia. But the stock apears to be less risky and, when comparing its historical volatility, Hilton Worldwide Holdings is 1.13 times less risky than Expedia. The stock trades about -0.34 of its potential returns per unit of risk. The Expedia Group is currently generating about -0.26 of returns per unit of risk over similar time horizon. If you would invest 13,810 in Expedia Group on January 20, 2024 and sell it today you would lose (910.00) from holding Expedia Group or give up 6.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hilton Worldwide Holdings vs. Expedia Group
Performance |
| Timeline |
| Hilton Worldwide Holdings |
| Expedia Group |
Hilton Worldwide and Expedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hilton Worldwide and Expedia
The main advantage of trading using opposite Hilton Worldwide and Expedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hilton Worldwide position performs unexpectedly, Expedia 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 Expedia will offset losses from the drop in Expedia's long position.| Hilton Worldwide vs. Yatra Online | Hilton Worldwide vs. Despegar Corp | Hilton Worldwide vs. Mondee Holdings | Hilton Worldwide vs. MakeMyTrip Limited |
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 AI Investment Finder module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position 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 | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |