Correlation Between Wyndham Hotels and Thor Industries

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

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

Diversification Opportunities for Wyndham Hotels and Thor Industries

0.4

Correlation Coefficient

Wyndham Hotels  Thor Industries

Very weak diversification

The 3 months correlation between Wyndham and Thor is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Wyndham Hotels Resorts and Thor Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thor Industries and Wyndham 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 Wyndham Hotels Resorts are associated (or correlated) with Thor Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thor Industries has no effect on the direction of Wyndham Hotels i.e., Wyndham Hotels and Thor Industries go up and down completely randomly.

Pair Corralation between Wyndham Hotels and Thor Industries

Allowing for the 90-day total investment horizon Wyndham Hotels Resorts is expected to under-perform the Thor Industries. But the stock apears to be less risky and, when comparing its historical volatility, Wyndham Hotels Resorts is 1.33 times less risky than Thor Industries. The stock trades about -0.04 of its potential returns per unit of risk. The Thor Industries is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  10,351  in Thor Industries on October 7, 2025 and sell it today you would earn a total of  151.00  from holding Thor Industries or generate 1.46% return on investment over 90 days.

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

Wyndham Hotels Resorts  vs.  Thor Industries

Wyndham Hotels Resorts

Risk-Adjusted Performance

Weakest

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

Thor Industries

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Thor Industries are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical indicators, Thor Industries is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Wyndham Hotels and Thor Industries

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

The idea behind Wyndham Hotels Resorts and Thor Industries 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.