Correlation Between MHP Hotel and JAPAN AIRLINES
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By analyzing existing cross correlation between MHP Hotel AG and JAPAN AIRLINES, you can compare the effects of market volatilities on MHP Hotel and JAPAN AIRLINES 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 JAPAN AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of MHP Hotel and JAPAN AIRLINES.
Diversification Opportunities for MHP Hotel and JAPAN AIRLINES
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MHP and JAPAN is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding MHP Hotel AG and JAPAN AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JAPAN AIRLINES 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 JAPAN AIRLINES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JAPAN AIRLINES has no effect on the direction of MHP Hotel i.e., MHP Hotel and JAPAN AIRLINES go up and down completely randomly.
Pair Corralation between MHP Hotel and JAPAN AIRLINES
Assuming the 90 days trading horizon MHP Hotel AG is expected to generate 1.83 times more return on investment than JAPAN AIRLINES. However, MHP Hotel is 1.83 times more volatile than JAPAN AIRLINES. It trades about 0.01 of its potential returns per unit of risk. JAPAN AIRLINES is currently generating about -0.05 per unit of risk. If you would invest 124.00 in MHP Hotel AG on October 12, 2024 and sell it today you would earn a total of 1.00 from holding MHP Hotel AG or generate 0.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MHP Hotel AG vs. JAPAN AIRLINES
Performance |
| Timeline |
| MHP Hotel AG |
| JAPAN AIRLINES |
MHP Hotel and JAPAN AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MHP Hotel and JAPAN AIRLINES
The main advantage of trading using opposite MHP Hotel and JAPAN AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MHP Hotel position performs unexpectedly, JAPAN AIRLINES 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 JAPAN AIRLINES will offset losses from the drop in JAPAN AIRLINES's long position.| MHP Hotel vs. United Utilities Group | MHP Hotel vs. Algonquin Power Utilities | MHP Hotel vs. Tencent Music Entertainment | MHP Hotel vs. Wizz Air Holdings |
| JAPAN AIRLINES vs. National Beverage Corp | JAPAN AIRLINES vs. INDOFOOD AGRI RES | JAPAN AIRLINES vs. GRIFFIN MINING LTD | JAPAN AIRLINES vs. VIVA WINE GROUP |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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