Correlation Between HYATT HOTELS and NMI Holdings
Can any of the company-specific risk be diversified away by investing in both HYATT HOTELS and NMI Holdings 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 HYATT HOTELS and NMI Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HYATT HOTELS A and NMI Holdings, you can compare the effects of market volatilities on HYATT HOTELS and NMI Holdings 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 HYATT HOTELS with a short position of NMI Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of HYATT HOTELS and NMI Holdings.
Diversification Opportunities for HYATT HOTELS and NMI Holdings
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between HYATT and NMI is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding HYATT HOTELS A and NMI Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NMI Holdings and HYATT 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 HYATT HOTELS A are associated (or correlated) with NMI Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NMI Holdings has no effect on the direction of HYATT HOTELS i.e., HYATT HOTELS and NMI Holdings go up and down completely randomly.
Pair Corralation between HYATT HOTELS and NMI Holdings
Assuming the 90 days trading horizon HYATT HOTELS A is expected to generate 0.94 times more return on investment than NMI Holdings. However, HYATT HOTELS A is 1.06 times less risky than NMI Holdings. It trades about 0.07 of its potential returns per unit of risk. NMI Holdings is currently generating about -0.01 per unit of risk. If you would invest 14,730 in HYATT HOTELS A on September 13, 2024 and sell it today you would earn a total of 335.00 from holding HYATT HOTELS A or generate 2.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HYATT HOTELS A vs. NMI Holdings
Performance |
| Timeline |
| HYATT HOTELS A |
| NMI Holdings |
HYATT HOTELS and NMI Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HYATT HOTELS and NMI Holdings
The main advantage of trading using opposite HYATT HOTELS and NMI Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HYATT HOTELS position performs unexpectedly, NMI Holdings 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 NMI Holdings will offset losses from the drop in NMI Holdings' long position.| HYATT HOTELS vs. Apple Inc | HYATT HOTELS vs. Apple Inc | HYATT HOTELS vs. Apple Inc | HYATT HOTELS vs. Apple Inc |
| NMI Holdings vs. JJ SNACK FOODS | NMI Holdings vs. Tradegate AG Wertpapierhandelsbank | NMI Holdings vs. JSC Halyk bank | NMI Holdings vs. VARIOUS EATERIES LS |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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