Correlation Between Accel Entertainment and Meli Hotels
Can any of the company-specific risk be diversified away by investing in both Accel Entertainment and Meli Hotels 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 Accel Entertainment and Meli Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Accel Entertainment and Meli Hotels International, you can compare the effects of market volatilities on Accel Entertainment and Meli Hotels 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 Accel Entertainment with a short position of Meli Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Accel Entertainment and Meli Hotels.
Diversification Opportunities for Accel Entertainment and Meli Hotels
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Accel and Meli is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Accel Entertainment and Meli Hotels International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meli Hotels International and Accel Entertainment 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 Accel Entertainment are associated (or correlated) with Meli Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meli Hotels International has no effect on the direction of Accel Entertainment i.e., Accel Entertainment and Meli Hotels go up and down completely randomly.
Pair Corralation between Accel Entertainment and Meli Hotels
Given the investment horizon of 90 days Accel Entertainment is expected to under-perform the Meli Hotels. But the stock apears to be less risky and, when comparing its historical volatility, Accel Entertainment is 1.37 times less risky than Meli Hotels. The stock trades about -0.01 of its potential returns per unit of risk. The Meli Hotels International is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 711.00 in Meli Hotels International on September 13, 2024 and sell it today you would earn a total of 68.00 from holding Meli Hotels International or generate 9.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Accel Entertainment vs. Meli Hotels International
Performance |
| Timeline |
| Accel Entertainment |
| Meli Hotels International |
Accel Entertainment and Meli Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Accel Entertainment and Meli Hotels
The main advantage of trading using opposite Accel Entertainment and Meli Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Accel Entertainment position performs unexpectedly, Meli Hotels 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 Meli Hotels will offset losses from the drop in Meli Hotels' long position.| Accel Entertainment vs. Light Wonder | Accel Entertainment vs. Everi Holdings | Accel Entertainment vs. Inspired Entertainment | Accel Entertainment vs. International Game Technology |
| Meli Hotels vs. Marriott International | Meli Hotels vs. Hilton Worldwide Holdings | Meli Hotels vs. InterContinental Hotels Group | Meli Hotels vs. Accor SA |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |