Correlation Between MHP Hotel and Aluminum
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By analyzing existing cross correlation between MHP Hotel AG and Aluminum of, you can compare the effects of market volatilities on MHP Hotel and Aluminum 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 MHP Hotel with a short position of Aluminum. Check out your portfolio center. Please also check ongoing floating volatility patterns of MHP Hotel and Aluminum.
Diversification Opportunities for MHP Hotel and Aluminum
Weak diversification
The 3 months correlation between MHP and Aluminum is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding MHP Hotel AG and Aluminum of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aluminum and MHP Hotel 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 MHP Hotel AG are associated (or correlated) with Aluminum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aluminum has no effect on the direction of MHP Hotel i.e., MHP Hotel and Aluminum go up and down completely randomly.
Pair Corralation between MHP Hotel and Aluminum
Assuming the 90 days trading horizon MHP Hotel is expected to generate 2.03 times less return on investment than Aluminum. But when comparing it to its historical volatility, MHP Hotel AG is 1.21 times less risky than Aluminum. It trades about 0.14 of its potential returns per unit of risk. Aluminum of is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 55.00 in Aluminum of on October 28, 2024 and sell it today you would earn a total of 8.00 from holding Aluminum of or generate 14.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MHP Hotel AG vs. Aluminum of
Performance |
| Timeline |
| MHP Hotel AG |
| Aluminum |
MHP Hotel and Aluminum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MHP Hotel and Aluminum
The main advantage of trading using opposite MHP Hotel and Aluminum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MHP Hotel position performs unexpectedly, Aluminum 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 Aluminum will offset losses from the drop in Aluminum's long position.| MHP Hotel vs. COPLAND ROAD CAPITAL | MHP Hotel vs. Broadcom | MHP Hotel vs. Zoom Video Communications | MHP Hotel vs. Citic Telecom International |
| Aluminum vs. ARDAGH METAL PACDL 0001 | Aluminum vs. SERI INDUSTRIAL EO | Aluminum vs. LOANDEPOT INC A | Aluminum vs. Global Ship Lease |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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