Correlation Between Agilent Technologies and Hilton Worldwide
Can any of the company-specific risk be diversified away by investing in both Agilent Technologies and Hilton Worldwide 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 Agilent Technologies and Hilton Worldwide into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agilent Technologies and Hilton Worldwide Holdings, you can compare the effects of market volatilities on Agilent Technologies and Hilton Worldwide 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 Agilent Technologies with a short position of Hilton Worldwide. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilent Technologies and Hilton Worldwide.
Diversification Opportunities for Agilent Technologies and Hilton Worldwide
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Agilent and Hilton is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and Hilton Worldwide Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hilton Worldwide Holdings and Agilent Technologies 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 Agilent Technologies are associated (or correlated) with Hilton Worldwide. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hilton Worldwide Holdings has no effect on the direction of Agilent Technologies i.e., Agilent Technologies and Hilton Worldwide go up and down completely randomly.
Pair Corralation between Agilent Technologies and Hilton Worldwide
Taking into account the 90-day investment horizon Agilent Technologies is expected to under-perform the Hilton Worldwide. In addition to that, Agilent Technologies is 1.25 times more volatile than Hilton Worldwide Holdings. It trades about -0.12 of its total potential returns per unit of risk. Hilton Worldwide Holdings is currently generating about -0.13 per unit of volatility. If you would invest 21,304 in Hilton Worldwide Holdings on January 26, 2024 and sell it today you would lose (834.00) from holding Hilton Worldwide Holdings or give up 3.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agilent Technologies vs. Hilton Worldwide Holdings
Performance |
| Timeline |
| Agilent Technologies |
| Hilton Worldwide Holdings |
Agilent Technologies and Hilton Worldwide Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilent Technologies and Hilton Worldwide
The main advantage of trading using opposite Agilent Technologies and Hilton Worldwide positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilent Technologies position performs unexpectedly, Hilton Worldwide 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 Hilton Worldwide will offset losses from the drop in Hilton Worldwide's long position.| Agilent Technologies vs. Fonar | Agilent Technologies vs. Burning Rock BiotechLtd | Agilent Technologies vs. Sera Prognostics | Agilent Technologies vs. Psychemedics |
| Hilton Worldwide vs. Hyatt Hotels | Hilton Worldwide vs. Wyndham Hotels Resorts | Hilton Worldwide vs. Choice Hotels International | Hilton Worldwide 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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