Correlation Between COVIVIO HOTELS and Meiko Electronics
Can any of the company-specific risk be diversified away by investing in both COVIVIO HOTELS and Meiko Electronics 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 COVIVIO HOTELS and Meiko Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COVIVIO HOTELS INH and Meiko Electronics Co, you can compare the effects of market volatilities on COVIVIO HOTELS and Meiko Electronics 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 COVIVIO HOTELS with a short position of Meiko Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of COVIVIO HOTELS and Meiko Electronics.
Diversification Opportunities for COVIVIO HOTELS and Meiko Electronics
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between COVIVIO and Meiko is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding COVIVIO HOTELS INH and Meiko Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meiko Electronics and COVIVIO 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 COVIVIO HOTELS INH are associated (or correlated) with Meiko Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meiko Electronics has no effect on the direction of COVIVIO HOTELS i.e., COVIVIO HOTELS and Meiko Electronics go up and down completely randomly.
Pair Corralation between COVIVIO HOTELS and Meiko Electronics
Assuming the 90 days horizon COVIVIO HOTELS INH is expected to generate 0.91 times more return on investment than Meiko Electronics. However, COVIVIO HOTELS INH is 1.1 times less risky than Meiko Electronics. It trades about 0.07 of its potential returns per unit of risk. Meiko Electronics Co is currently generating about 0.04 per unit of risk. If you would invest 1,835 in COVIVIO HOTELS INH on October 19, 2024 and sell it today you would earn a total of 70.00 from holding COVIVIO HOTELS INH or generate 3.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
COVIVIO HOTELS INH vs. Meiko Electronics Co
Performance |
| Timeline |
| COVIVIO HOTELS INH |
| Meiko Electronics |
COVIVIO HOTELS and Meiko Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COVIVIO HOTELS and Meiko Electronics
The main advantage of trading using opposite COVIVIO HOTELS and Meiko Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COVIVIO HOTELS position performs unexpectedly, Meiko Electronics 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 Meiko Electronics will offset losses from the drop in Meiko Electronics' long position.| COVIVIO HOTELS vs. Nomad Foods | COVIVIO HOTELS vs. MTY Food Group | COVIVIO HOTELS vs. PLANT VEDA FOODS | COVIVIO HOTELS vs. Austevoll Seafood ASA |
| Meiko Electronics vs. Singapore Telecommunications Limited | Meiko Electronics vs. Cairo Communication SpA | Meiko Electronics vs. COVIVIO HOTELS INH | Meiko Electronics vs. Choice Hotels International |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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