Correlation Between Host Hotels and Helical Bar
Can any of the company-specific risk be diversified away by investing in both Host Hotels and Helical Bar 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 Host Hotels and Helical Bar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Host Hotels Resorts and Helical Bar Plc, you can compare the effects of market volatilities on Host Hotels and Helical Bar 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 Host Hotels with a short position of Helical Bar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Host Hotels and Helical Bar.
Diversification Opportunities for Host Hotels and Helical Bar
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Host and Helical is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Host Hotels Resorts and Helical Bar Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helical Bar Plc and Host 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 Host Hotels Resorts are associated (or correlated) with Helical Bar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helical Bar Plc has no effect on the direction of Host Hotels i.e., Host Hotels and Helical Bar go up and down completely randomly.
Pair Corralation between Host Hotels and Helical Bar
Assuming the 90 days trading horizon Host Hotels Resorts is expected to generate 1.11 times more return on investment than Helical Bar. However, Host Hotels is 1.11 times more volatile than Helical Bar Plc. It trades about 0.14 of its potential returns per unit of risk. Helical Bar Plc is currently generating about -0.21 per unit of risk. If you would invest 1,700 in Host Hotels Resorts on September 12, 2024 and sell it today you would earn a total of 209.00 from holding Host Hotels Resorts or generate 12.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Host Hotels Resorts vs. Helical Bar Plc
Performance |
| Timeline |
| Host Hotels Resorts |
| Helical Bar Plc |
Host Hotels and Helical Bar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Host Hotels and Helical Bar
The main advantage of trading using opposite Host Hotels and Helical Bar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Host Hotels position performs unexpectedly, Helical Bar 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 Helical Bar will offset losses from the drop in Helical Bar's long position.| Host Hotels vs. Hong Kong Land | Host Hotels vs. Neometals | Host Hotels vs. Coor Service Management | Host Hotels vs. Fidelity Sustainable USD |
| Helical Bar vs. Bankers Investment Trust | Helical Bar vs. Hansa Investment | Helical Bar vs. Lowland Investment Co | Helical Bar vs. Kinnevik Investment AB |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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