Correlation Between Sands China and Vail Resorts

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

Diversification Opportunities for Sands China and Vail Resorts

0.71
  Correlation Coefficient

Poor diversification

The 3 months correlation between Sands and Vail is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Sands China and Vail Resorts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vail Resorts and Sands China 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 Sands China are associated (or correlated) with Vail Resorts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vail Resorts has no effect on the direction of Sands China i.e., Sands China and Vail Resorts go up and down completely randomly.

Pair Corralation between Sands China and Vail Resorts

Assuming the 90 days trading horizon Sands China is expected to generate 1.23 times more return on investment than Vail Resorts. However, Sands China is 1.23 times more volatile than Vail Resorts. It trades about -0.12 of its potential returns per unit of risk. Vail Resorts is currently generating about -0.16 per unit of risk. If you would invest  253.00  in Sands China on December 28, 2024 and sell it today you would lose (53.00) from holding Sands China or give up 20.95% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Sands China  vs.  Vail Resorts

 Performance 
       Timeline  
Sands China 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Sands China has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.
Vail Resorts 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Vail Resorts has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Sands China and Vail Resorts Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Sands China and Vail Resorts

The main advantage of trading using opposite Sands China and Vail Resorts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sands China position performs unexpectedly, Vail Resorts 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 Vail Resorts will offset losses from the drop in Vail Resorts' long position.
The idea behind Sands China and Vail Resorts 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.

Other Complementary Tools

Portfolio File Import
Quickly import all of your third-party portfolios from your local drive in csv format
Money Managers
Screen money managers from public funds and ETFs managed around the world
Equity Search
Search for actively traded equities including funds and ETFs from over 30 global markets
Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals