Correlation Between Melia Hotels and JB Hunt
Can any of the company-specific risk be diversified away by investing in both Melia Hotels and JB Hunt 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 Melia Hotels and JB Hunt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Melia Hotels and JB Hunt Transport, you can compare the effects of market volatilities on Melia Hotels and JB Hunt 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 Melia Hotels with a short position of JB Hunt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Melia Hotels and JB Hunt.
Diversification Opportunities for Melia Hotels and JB Hunt
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Melia and 0J71 is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Melia Hotels and JB Hunt Transport in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JB Hunt Transport and Melia 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 Melia Hotels are associated (or correlated) with JB Hunt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JB Hunt Transport has no effect on the direction of Melia Hotels i.e., Melia Hotels and JB Hunt go up and down completely randomly.
Pair Corralation between Melia Hotels and JB Hunt
Assuming the 90 days trading horizon Melia Hotels is expected to generate 0.75 times more return on investment than JB Hunt. However, Melia Hotels is 1.33 times less risky than JB Hunt. It trades about -0.03 of its potential returns per unit of risk. JB Hunt Transport is currently generating about -0.11 per unit of risk. If you would invest 734.00 in Melia Hotels on October 11, 2024 and sell it today you would lose (6.00) from holding Melia Hotels or give up 0.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Melia Hotels vs. JB Hunt Transport
Performance |
| Timeline |
| Melia Hotels |
| JB Hunt Transport |
Melia Hotels and JB Hunt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Melia Hotels and JB Hunt
The main advantage of trading using opposite Melia Hotels and JB Hunt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Melia Hotels position performs unexpectedly, JB Hunt 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 JB Hunt will offset losses from the drop in JB Hunt's long position.| Melia Hotels vs. Host Hotels Resorts | Melia Hotels vs. Delta Air Lines | Melia Hotels vs. Live Nation Entertainment | Melia Hotels vs. Wizz Air Holdings |
| JB Hunt vs. Tyson Foods Cl | JB Hunt vs. Dairy Farm International | JB Hunt vs. Indutrade AB | JB Hunt vs. Norwegian Air Shuttle |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| CEOs Directory Screen CEOs from public companies around the world |