Correlation Between Juniper Hotels and Viceroy Hotels

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

By analyzing existing cross correlation between Juniper Hotels and Viceroy Hotels Limited, you can compare the effects of market volatilities on Juniper Hotels and Viceroy Hotels 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 Juniper Hotels with a short position of Viceroy Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Juniper Hotels and Viceroy Hotels.

Diversification Opportunities for Juniper Hotels and Viceroy Hotels

0.17

Correlation Coefficient

Juniper Hotels  Viceroy Hotels

Average diversification

The 3 months correlation between Juniper and Viceroy is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Juniper Hotels and Viceroy Hotels Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viceroy Hotels and Juniper Hotels 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 Juniper Hotels are associated (or correlated) with Viceroy Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viceroy Hotels has no effect on the direction of Juniper Hotels i.e., Juniper Hotels and Viceroy Hotels go up and down completely randomly.

Pair Corralation between Juniper Hotels and Viceroy Hotels

Assuming the 90 days trading horizon Juniper Hotels is expected to under-perform the Viceroy Hotels. But the stock apears to be less risky and, when comparing its historical volatility, Juniper Hotels is 16.68 times less risky than Viceroy Hotels. The stock trades about -0.01 of its potential returns per unit of risk. The Viceroy Hotels Limited is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  175.00  in Viceroy Hotels Limited on September 23, 2024 and sell it today you would earn a total of  12,069  from holding Viceroy Hotels Limited or generate 6896.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	41.98%
Values	Daily Returns

Juniper Hotels  vs.  Viceroy Hotels Limited

Juniper Hotels

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Juniper Hotels has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Juniper Hotels is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Viceroy Hotels

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Viceroy Hotels Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's essential indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Juniper Hotels and Viceroy Hotels

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

The idea behind Juniper Hotels and Viceroy Hotels Limited 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.