Correlation Between Embassy Office and EIH Associated
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By analyzing existing cross correlation between Embassy Office Parks and EIH Associated Hotels, you can compare the effects of market volatilities on Embassy Office and EIH Associated 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 Embassy Office with a short position of EIH Associated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Embassy Office and EIH Associated.
Diversification Opportunities for Embassy Office and EIH Associated
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Embassy and EIH is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Embassy Office Parks and EIH Associated Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EIH Associated Hotels and Embassy Office 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 Embassy Office Parks are associated (or correlated) with EIH Associated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EIH Associated Hotels has no effect on the direction of Embassy Office i.e., Embassy Office and EIH Associated go up and down completely randomly.
Pair Corralation between Embassy Office and EIH Associated
Assuming the 90 days trading horizon Embassy Office is expected to generate 22.12 times less return on investment than EIH Associated. But when comparing it to its historical volatility, Embassy Office Parks is 1.79 times less risky than EIH Associated. It trades about 0.0 of its potential returns per unit of risk. EIH Associated Hotels is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 36,555 in EIH Associated Hotels on October 17, 2024 and sell it today you would earn a total of 1,910 from holding EIH Associated Hotels or generate 5.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.5% |
| Values | Daily Returns |
Embassy Office Parks vs. EIH Associated Hotels
Performance |
| Timeline |
| Embassy Office Parks |
| EIH Associated Hotels |
Embassy Office and EIH Associated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Embassy Office and EIH Associated
The main advantage of trading using opposite Embassy Office and EIH Associated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Embassy Office position performs unexpectedly, EIH Associated 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 EIH Associated will offset losses from the drop in EIH Associated's long position.| Embassy Office vs. DiGiSPICE Technologies Limited | Embassy Office vs. Entertainment Network Limited | Embassy Office vs. Next Mediaworks Limited | Embassy Office vs. Total Transport Systems |
| EIH Associated vs. Embassy Office Parks | EIH Associated vs. Spencers Retail Limited | EIH Associated vs. Next Mediaworks Limited | EIH Associated vs. Credo Brands Marketing |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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