Correlation Between COFCO Joycome and COVIVIO HOTELS
Can any of the company-specific risk be diversified away by investing in both COFCO Joycome and COVIVIO 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 COFCO Joycome and COVIVIO HOTELS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COFCO Joycome Foods and COVIVIO HOTELS INH, you can compare the effects of market volatilities on COFCO Joycome and COVIVIO 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 COFCO Joycome with a short position of COVIVIO HOTELS. Check out your portfolio center. Please also check ongoing floating volatility patterns of COFCO Joycome and COVIVIO HOTELS.
Diversification Opportunities for COFCO Joycome and COVIVIO HOTELS
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between COFCO and COVIVIO is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding COFCO Joycome Foods and COVIVIO HOTELS INH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COVIVIO HOTELS INH and COFCO Joycome 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 COFCO Joycome Foods are associated (or correlated) with COVIVIO HOTELS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COVIVIO HOTELS INH has no effect on the direction of COFCO Joycome i.e., COFCO Joycome and COVIVIO HOTELS go up and down completely randomly.
Pair Corralation between COFCO Joycome and COVIVIO HOTELS
Assuming the 90 days horizon COFCO Joycome Foods is expected to generate 2.73 times more return on investment than COVIVIO HOTELS. However, COFCO Joycome is 2.73 times more volatile than COVIVIO HOTELS INH. It trades about 0.1 of its potential returns per unit of risk. COVIVIO HOTELS INH is currently generating about -0.03 per unit of risk. If you would invest 14.00 in COFCO Joycome Foods on September 12, 2024 and sell it today you would earn a total of 3.00 from holding COFCO Joycome Foods or generate 21.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COFCO Joycome Foods vs. COVIVIO HOTELS INH
Performance |
| Timeline |
| COFCO Joycome Foods |
| COVIVIO HOTELS INH |
COFCO Joycome and COVIVIO HOTELS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COFCO Joycome and COVIVIO HOTELS
The main advantage of trading using opposite COFCO Joycome and COVIVIO HOTELS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COFCO Joycome position performs unexpectedly, COVIVIO 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 COVIVIO HOTELS will offset losses from the drop in COVIVIO HOTELS's long position.| COFCO Joycome vs. Hormel Foods | COFCO Joycome vs. Superior Plus Corp | COFCO Joycome vs. SIVERS SEMICONDUCTORS AB | COFCO Joycome vs. NorAm Drilling AS |
| COVIVIO HOTELS vs. Apple Inc | COVIVIO HOTELS vs. Apple Inc | COVIVIO HOTELS vs. Apple Inc | COVIVIO HOTELS vs. Apple Inc |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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