Correlation Between Xenia Hotels and DMG Mori
Can any of the company-specific risk be diversified away by investing in both Xenia Hotels and DMG Mori 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 Xenia Hotels and DMG Mori into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xenia Hotels Resorts and DMG Mori Co, you can compare the effects of market volatilities on Xenia Hotels and DMG Mori 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 Xenia Hotels with a short position of DMG Mori. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xenia Hotels and DMG Mori.
Diversification Opportunities for Xenia Hotels and DMG Mori
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Xenia and DMG is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Xenia Hotels Resorts and DMG Mori Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DMG Mori and Xenia 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 Xenia Hotels Resorts are associated (or correlated) with DMG Mori. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DMG Mori has no effect on the direction of Xenia Hotels i.e., Xenia Hotels and DMG Mori go up and down completely randomly.
Pair Corralation between Xenia Hotels and DMG Mori
Assuming the 90 days trading horizon Xenia Hotels Resorts is expected to generate 0.74 times more return on investment than DMG Mori. However, Xenia Hotels Resorts is 1.35 times less risky than DMG Mori. It trades about 0.23 of its potential returns per unit of risk. DMG Mori Co is currently generating about -0.05 per unit of risk. If you would invest 1,280 in Xenia Hotels Resorts on September 5, 2024 and sell it today you would earn a total of 160.00 from holding Xenia Hotels Resorts or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Xenia Hotels Resorts vs. DMG Mori Co
Performance |
| Timeline |
| Xenia Hotels Resorts |
| DMG Mori |
Xenia Hotels and DMG Mori Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xenia Hotels and DMG Mori
The main advantage of trading using opposite Xenia Hotels and DMG Mori positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xenia Hotels position performs unexpectedly, DMG Mori 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 DMG Mori will offset losses from the drop in DMG Mori's long position.| Xenia Hotels vs. BE Semiconductor Industries | Xenia Hotels vs. Tower Semiconductor | Xenia Hotels vs. CarsalesCom | Xenia Hotels vs. CANON MARKETING JP |
| DMG Mori vs. ANGLER GAMING PLC | DMG Mori vs. ULTRA CLEAN HLDGS | DMG Mori vs. OURGAME INTHOLDL 00005 | DMG Mori vs. DXC Technology Co |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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