Correlation Between Xenia Hotels and NEXON
Can any of the company-specific risk be diversified away by investing in both Xenia Hotels and NEXON 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 NEXON 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 NEXON Co, you can compare the effects of market volatilities on Xenia Hotels and NEXON 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 NEXON. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xenia Hotels and NEXON.
Diversification Opportunities for Xenia Hotels and NEXON
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Xenia and NEXON is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Xenia Hotels Resorts and NEXON Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEXON 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 NEXON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEXON has no effect on the direction of Xenia Hotels i.e., Xenia Hotels and NEXON go up and down completely randomly.
Pair Corralation between Xenia Hotels and NEXON
Assuming the 90 days trading horizon Xenia Hotels is expected to generate 12.54 times less return on investment than NEXON. But when comparing it to its historical volatility, Xenia Hotels Resorts is 3.97 times less risky than NEXON. It trades about 0.02 of its potential returns per unit of risk. NEXON Co is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 287.00 in NEXON Co on October 26, 2024 and sell it today you would earn a total of 983.00 from holding NEXON Co or generate 342.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xenia Hotels Resorts vs. NEXON Co
Performance |
| Timeline |
| Xenia Hotels Resorts |
| NEXON |
Xenia Hotels and NEXON Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xenia Hotels and NEXON
The main advantage of trading using opposite Xenia Hotels and NEXON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xenia Hotels position performs unexpectedly, NEXON 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 NEXON will offset losses from the drop in NEXON's long position.| Xenia Hotels vs. Silicon Motion Technology | Xenia Hotels vs. British American Tobacco | Xenia Hotels vs. AIR PRODCHEMICALS | Xenia Hotels vs. REINET INVESTMENTS SCA |
| NEXON vs. MidCap Financial Investment | NEXON vs. CHRYSALIS INVESTMENTS LTD | NEXON vs. Gaztransport Technigaz SA | NEXON vs. PennantPark 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |