Correlation Between Thayer Ventures and Hilton Worldwide

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

By analyzing existing cross correlation between Thayer Ventures Acquisition and Hilton Worldwide Holdings, you can compare the effects of market volatilities on Thayer Ventures 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 Thayer Ventures with a short position of Hilton Worldwide. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thayer Ventures and Hilton Worldwide.

Diversification Opportunities for Thayer Ventures and Hilton Worldwide

-0.62

Correlation Coefficient

Thayer Ventures  Hilton Worldwide

Excellent diversification

The 3 months correlation between Thayer and Hilton is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Thayer Ventures Acquisition 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 Thayer Ventures 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 Thayer Ventures Acquisition 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 Thayer Ventures i.e., Thayer Ventures and Hilton Worldwide go up and down completely randomly.

Pair Corralation between Thayer Ventures and Hilton Worldwide

Assuming the 90 days horizon Thayer Ventures Acquisition is expected to generate 21.88 times more return on investment than Hilton Worldwide. However, Thayer Ventures is 21.88 times more volatile than Hilton Worldwide Holdings. It trades about 0.06 of its potential returns per unit of risk. Hilton Worldwide Holdings is currently generating about 0.07 per unit of risk. If you would invest  1.30  in Thayer Ventures Acquisition on September 17, 2024 and sell it today you would lose (0.30) from holding Thayer Ventures Acquisition or give up 23.08% of portfolio value over 90 days.

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

Thayer Ventures Acquisition  vs.  Hilton Worldwide Holdings

Thayer Ventures Acqu

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Thayer Ventures Acquisition are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent basic indicators, Thayer Ventures showed solid returns over the last few months and may actually be approaching a breakup point.

Hilton Worldwide Holdings

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Hilton Worldwide Holdings are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady essential indicators, Hilton Worldwide unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Thayer Ventures and Hilton Worldwide

The main advantage of trading using opposite Thayer Ventures and Hilton Worldwide positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thayer Ventures 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.

The idea behind Thayer Ventures Acquisition and Hilton Worldwide 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.