Correlation Between Oasis Hotel and Wendys

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Can any of the company-specific risk be diversified away by investing in both Oasis Hotel and Wendys 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 Oasis Hotel and Wendys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oasis Hotel Resort and The Wendys Co, you can compare the effects of market volatilities on Oasis Hotel and Wendys 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 Oasis Hotel with a short position of Wendys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oasis Hotel and Wendys.

Diversification Opportunities for Oasis Hotel and Wendys

OasisWendysDiversified AwayOasisWendysDiversified Away100%
0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Oasis and Wendys is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Oasis Hotel Resort and The Wendys Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Wendys and Oasis Hotel 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 Oasis Hotel Resort are associated (or correlated) with Wendys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Wendys has no effect on the direction of Oasis Hotel i.e., Oasis Hotel and Wendys go up and down completely randomly.

Pair Corralation between Oasis Hotel and Wendys

If you would invest  0.02  in Oasis Hotel Resort on October 15, 2024 and sell it today you would earn a total of  0.00  from holding Oasis Hotel Resort or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Oasis Hotel Resort  vs.  The Wendys Co

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -5051015
JavaScript chart by amCharts 3.21.15OHTR WEN
       Timeline  
Oasis Hotel Resort 

Risk-Adjusted Performance

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Over the last 90 days Oasis Hotel Resort has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Oasis Hotel is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan0.00020.0002050.000210.000215
The Wendys 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days The Wendys Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan151617181920

Oasis Hotel and Wendys Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15 0.020.040.060.080.100.12
JavaScript chart by amCharts 3.21.15OHTR WEN
       Returns  

Pair Trading with Oasis Hotel and Wendys

The main advantage of trading using opposite Oasis Hotel and Wendys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oasis Hotel position performs unexpectedly, Wendys 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 Wendys will offset losses from the drop in Wendys' long position.
The idea behind Oasis Hotel Resort and The Wendys Co 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 CEOs Directory module to screen CEOs from public companies around the world.

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