Correlation Between Appen and Hotel Property
Can any of the company-specific risk be diversified away by investing in both Appen and Hotel Property 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 Appen and Hotel Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Appen and Hotel Property Investments, you can compare the effects of market volatilities on Appen and Hotel Property 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 Appen with a short position of Hotel Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Appen and Hotel Property.
Diversification Opportunities for Appen and Hotel Property
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Appen and Hotel is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Appen and Hotel Property Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hotel Property Inves and Appen 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 Appen are associated (or correlated) with Hotel Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hotel Property Inves has no effect on the direction of Appen i.e., Appen and Hotel Property go up and down completely randomly.
Pair Corralation between Appen and Hotel Property
Assuming the 90 days trading horizon Appen is expected to generate 31.09 times more return on investment than Hotel Property. However, Appen is 31.09 times more volatile than Hotel Property Investments. It trades about 0.16 of its potential returns per unit of risk. Hotel Property Investments is currently generating about 0.0 per unit of risk. If you would invest 219.00 in Appen on October 25, 2024 and sell it today you would earn a total of 32.00 from holding Appen or generate 14.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Appen vs. Hotel Property Investments
Performance |
| Timeline |
| Appen |
| Hotel Property Inves |
Appen and Hotel Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Appen and Hotel Property
The main advantage of trading using opposite Appen and Hotel Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Appen position performs unexpectedly, Hotel Property 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 Hotel Property will offset losses from the drop in Hotel Property's long position.| Appen vs. Thorney Technologies | Appen vs. Carnegie Clean Energy | Appen vs. Cleanaway Waste Management | Appen vs. Neurotech International |
| Hotel Property vs. Regal Funds Management | Hotel Property vs. Health and Plant | Hotel Property vs. Regis Healthcare | Hotel Property vs. Mayfield Childcare |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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