Correlation Between MHP Hotel and Host Hotels
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By analyzing existing cross correlation between MHP Hotel AG and Host Hotels Resorts, you can compare the effects of market volatilities on MHP Hotel and Host 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 MHP Hotel with a short position of Host Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of MHP Hotel and Host Hotels.
Diversification Opportunities for MHP Hotel and Host Hotels
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between MHP and Host is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding MHP Hotel AG and Host Hotels Resorts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Host Hotels Resorts 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 Host Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Host Hotels Resorts has no effect on the direction of MHP Hotel i.e., MHP Hotel and Host Hotels go up and down completely randomly.
Pair Corralation between MHP Hotel and Host Hotels
Assuming the 90 days trading horizon MHP Hotel is expected to generate 5.47 times less return on investment than Host Hotels. In addition to that, MHP Hotel is 1.55 times more volatile than Host Hotels Resorts. It trades about 0.02 of its total potential returns per unit of risk. Host Hotels Resorts is currently generating about 0.14 per unit of volatility. If you would invest 1,610 in Host Hotels Resorts on August 28, 2024 and sell it today you would earn a total of 110.00 from holding Host Hotels Resorts or generate 6.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MHP Hotel AG vs. Host Hotels Resorts
Performance |
| Timeline |
| MHP Hotel AG |
| Host Hotels Resorts |
MHP Hotel and Host Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MHP Hotel and Host Hotels
The main advantage of trading using opposite MHP Hotel and Host Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MHP Hotel position performs unexpectedly, Host 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 Host Hotels will offset losses from the drop in Host Hotels' long position.| MHP Hotel vs. Lloyds Banking Group | MHP Hotel vs. KB Financial Group | MHP Hotel vs. ORIX Corporation | MHP Hotel vs. Orix Corp Ads |
| Host Hotels vs. VIAPLAY GROUP AB | Host Hotels vs. CVW CLEANTECH INC | Host Hotels vs. COLUMBIA SPORTSWEAR | Host Hotels vs. ANTA SPORTS PRODUCT |
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.
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