Correlation Between Acciona and Atom Hoteles
Can any of the company-specific risk be diversified away by investing in both Acciona and Atom Hoteles 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 Acciona and Atom Hoteles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acciona and Atom Hoteles Socimi, you can compare the effects of market volatilities on Acciona and Atom Hoteles 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 Acciona with a short position of Atom Hoteles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acciona and Atom Hoteles.
Diversification Opportunities for Acciona and Atom Hoteles
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Acciona and Atom is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Acciona and Atom Hoteles Socimi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atom Hoteles Socimi and Acciona 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 Acciona are associated (or correlated) with Atom Hoteles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atom Hoteles Socimi has no effect on the direction of Acciona i.e., Acciona and Atom Hoteles go up and down completely randomly.
Pair Corralation between Acciona and Atom Hoteles
Assuming the 90 days trading horizon Acciona is expected to generate 8.04 times more return on investment than Atom Hoteles. However, Acciona is 8.04 times more volatile than Atom Hoteles Socimi. It trades about 0.15 of its potential returns per unit of risk. Atom Hoteles Socimi is currently generating about 0.22 per unit of risk. If you would invest 10,840 in Acciona on November 27, 2024 and sell it today you would earn a total of 410.00 from holding Acciona or generate 3.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acciona vs. Atom Hoteles Socimi
Performance |
| Timeline |
| Acciona |
| Atom Hoteles Socimi |
Acciona and Atom Hoteles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acciona and Atom Hoteles
The main advantage of trading using opposite Acciona and Atom Hoteles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acciona position performs unexpectedly, Atom Hoteles 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 Atom Hoteles will offset losses from the drop in Atom Hoteles' long position.The idea behind Acciona and Atom Hoteles Socimi pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Atom Hoteles vs. Arteche Lantegi Elkartea | Atom Hoteles vs. Atresmedia Corporacin de | Atom Hoteles vs. Elaia Investment Spain | Atom Hoteles vs. Home Capital Rentals |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| 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 | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |