Correlation Between MAVEN WIRELESS and NH HOTEL
Can any of the company-specific risk be diversified away by investing in both MAVEN WIRELESS and NH HOTEL 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 MAVEN WIRELESS and NH HOTEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MAVEN WIRELESS SWEDEN and NH HOTEL GROUP, you can compare the effects of market volatilities on MAVEN WIRELESS and NH HOTEL 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 MAVEN WIRELESS with a short position of NH HOTEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAVEN WIRELESS and NH HOTEL.
Diversification Opportunities for MAVEN WIRELESS and NH HOTEL
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between MAVEN and NH5 is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding MAVEN WIRELESS SWEDEN and NH HOTEL GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NH HOTEL GROUP and MAVEN WIRELESS 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 MAVEN WIRELESS SWEDEN are associated (or correlated) with NH HOTEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NH HOTEL GROUP has no effect on the direction of MAVEN WIRELESS i.e., MAVEN WIRELESS and NH HOTEL go up and down completely randomly.
Pair Corralation between MAVEN WIRELESS and NH HOTEL
Assuming the 90 days horizon MAVEN WIRELESS SWEDEN is expected to under-perform the NH HOTEL. But the stock apears to be less risky and, when comparing its historical volatility, MAVEN WIRELESS SWEDEN is 1.07 times less risky than NH HOTEL. The stock trades about -0.02 of its potential returns per unit of risk. The NH HOTEL GROUP is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 310.00 in NH HOTEL GROUP on September 14, 2024 and sell it today you would earn a total of 133.00 from holding NH HOTEL GROUP or generate 42.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MAVEN WIRELESS SWEDEN vs. NH HOTEL GROUP
Performance |
| Timeline |
| MAVEN WIRELESS SWEDEN |
| NH HOTEL GROUP |
MAVEN WIRELESS and NH HOTEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MAVEN WIRELESS and NH HOTEL
The main advantage of trading using opposite MAVEN WIRELESS and NH HOTEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MAVEN WIRELESS position performs unexpectedly, NH HOTEL 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 NH HOTEL will offset losses from the drop in NH HOTEL's long position.| MAVEN WIRELESS vs. Superior Plus Corp | MAVEN WIRELESS vs. SIVERS SEMICONDUCTORS AB | MAVEN WIRELESS vs. Norsk Hydro ASA | MAVEN WIRELESS vs. Reliance Steel Aluminum |
| NH HOTEL vs. Brockhaus Capital Management | NH HOTEL vs. MTI WIRELESS EDGE | NH HOTEL vs. Zijin Mining Group | NH HOTEL vs. MAVEN WIRELESS SWEDEN |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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