Correlation Between Bluegreen Vacations and Hilton Grand

Can any of the company-specific risk be diversified away by investing in both Bluegreen Vacations and Hilton Grand 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 Bluegreen Vacations and Hilton Grand into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bluegreen Vacations Holding and Hilton Grand Vacations, you can compare the effects of market volatilities on Bluegreen Vacations and Hilton Grand 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 Bluegreen Vacations with a short position of Hilton Grand. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bluegreen Vacations and Hilton Grand.

Diversification Opportunities for Bluegreen Vacations and Hilton Grand

0.71

Correlation Coefficient

Bluegreen Vacations  Hilton Grand

Poor diversification

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

Pair Corralation between Bluegreen Vacations and Hilton Grand

If you would invest  3,790  in Hilton Grand Vacations on August 31, 2024 and sell it today you would earn a total of  449.00  from holding Hilton Grand Vacations or generate 11.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	1.56%
Values	Daily Returns

Bluegreen Vacations Holding  vs.  Hilton Grand Vacations

Bluegreen Vacations

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bluegreen Vacations Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Bluegreen Vacations is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Hilton Grand Vacations

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Hilton Grand Vacations are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating technical and fundamental indicators, Hilton Grand may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with Bluegreen Vacations and Hilton Grand

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

The idea behind Bluegreen Vacations Holding and Hilton Grand Vacations 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.