Correlation Between Gold Road and MHP Hotel
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By analyzing existing cross correlation between Gold Road Resources and MHP Hotel AG, you can compare the effects of market volatilities on Gold Road and MHP Hotel 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 Gold Road with a short position of MHP Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Road and MHP Hotel.
Diversification Opportunities for Gold Road and MHP Hotel
Poor diversification
The 3 months correlation between Gold and MHP is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Gold Road Resources and MHP Hotel AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MHP Hotel AG and Gold Road 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 Gold Road Resources are associated (or correlated) with MHP Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MHP Hotel AG has no effect on the direction of Gold Road i.e., Gold Road and MHP Hotel go up and down completely randomly.
Pair Corralation between Gold Road and MHP Hotel
Assuming the 90 days horizon Gold Road Resources is expected to generate 0.76 times more return on investment than MHP Hotel. However, Gold Road Resources is 1.31 times less risky than MHP Hotel. It trades about 0.29 of its potential returns per unit of risk. MHP Hotel AG is currently generating about 0.05 per unit of risk. If you would invest 118.00 in Gold Road Resources on October 30, 2024 and sell it today you would earn a total of 27.00 from holding Gold Road Resources or generate 22.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gold Road Resources vs. MHP Hotel AG
Performance |
| Timeline |
| Gold Road Resources |
| MHP Hotel AG |
Gold Road and MHP Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gold Road and MHP Hotel
The main advantage of trading using opposite Gold Road and MHP Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold Road position performs unexpectedly, MHP Hotel 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 MHP Hotel will offset losses from the drop in MHP Hotel's long position.| Gold Road vs. CN DATANG C | Gold Road vs. Dairy Farm International | Gold Road vs. INFORMATION SVC GRP | Gold Road vs. NTT DATA |
| MHP Hotel vs. JAPAN TOBACCO UNSPADR12 | MHP Hotel vs. National Health Investors | MHP Hotel vs. ALERION CLEANPOWER | MHP Hotel vs. OPKO HEALTH |
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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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