Correlation Between MHP Hotel and Reliance Steel
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By analyzing existing cross correlation between MHP Hotel AG and Reliance Steel Aluminum, you can compare the effects of market volatilities on MHP Hotel and Reliance Steel 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 Reliance Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of MHP Hotel and Reliance Steel.
Diversification Opportunities for MHP Hotel and Reliance Steel
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between MHP and Reliance is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding MHP Hotel AG and Reliance Steel Aluminum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reliance Steel 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 Reliance Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reliance Steel Aluminum has no effect on the direction of MHP Hotel i.e., MHP Hotel and Reliance Steel go up and down completely randomly.
Pair Corralation between MHP Hotel and Reliance Steel
Assuming the 90 days trading horizon MHP Hotel AG is expected to generate 1.79 times more return on investment than Reliance Steel. However, MHP Hotel is 1.79 times more volatile than Reliance Steel Aluminum. It trades about 0.18 of its potential returns per unit of risk. Reliance Steel Aluminum is currently generating about -0.43 per unit of risk. If you would invest 118.00 in MHP Hotel AG on October 9, 2024 and sell it today you would earn a total of 9.00 from holding MHP Hotel AG or generate 7.63% 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. Reliance Steel Aluminum
Performance |
| Timeline |
| MHP Hotel AG |
| Reliance Steel Aluminum |
MHP Hotel and Reliance Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MHP Hotel and Reliance Steel
The main advantage of trading using opposite MHP Hotel and Reliance Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MHP Hotel position performs unexpectedly, Reliance Steel 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 Reliance Steel will offset losses from the drop in Reliance Steel's long position.| MHP Hotel vs. Genertec Universal Medical | MHP Hotel vs. COLUMBIA SPORTSWEAR | MHP Hotel vs. BII Railway Transportation | MHP Hotel vs. Columbia Sportswear |
| Reliance Steel vs. ecotel communication ag | Reliance Steel vs. Rocket Internet SE | Reliance Steel vs. Gladstone Investment | Reliance Steel vs. AGNC INVESTMENT |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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