Correlation Between FibraHotel and NVIDIA
Can any of the company-specific risk be diversified away by investing in both FibraHotel and NVIDIA at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining FibraHotel and NVIDIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FibraHotel and NVIDIA, you can compare the effects of market volatilities on FibraHotel and NVIDIA 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 FibraHotel with a short position of NVIDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of FibraHotel and NVIDIA.
Diversification Opportunities for FibraHotel and NVIDIA
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between FibraHotel and NVIDIA is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding FibraHotel and NVIDIA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NVIDIA and FibraHotel 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 FibraHotel are associated (or correlated) with NVIDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NVIDIA has no effect on the direction of FibraHotel i.e., FibraHotel and NVIDIA go up and down completely randomly.
Pair Corralation between FibraHotel and NVIDIA
Assuming the 90 days trading horizon FibraHotel is expected to under-perform the NVIDIA. But the stock apears to be less risky and, when comparing its historical volatility, FibraHotel is 1.31 times less risky than NVIDIA. The stock trades about -0.02 of its potential returns per unit of risk. The NVIDIA is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 244,141 in NVIDIA on November 28, 2024 and sell it today you would earn a total of 15,810 from holding NVIDIA or generate 6.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FibraHotel vs. NVIDIA
Performance |
| Timeline |
| FibraHotel |
| NVIDIA |
FibraHotel and NVIDIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FibraHotel and NVIDIA
The main advantage of trading using opposite FibraHotel and NVIDIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FibraHotel position performs unexpectedly, NVIDIA 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 NVIDIA will offset losses from the drop in NVIDIA's long position.| FibraHotel vs. Burlington Stores | FibraHotel vs. Ross Stores | FibraHotel vs. FIBRA Storage | FibraHotel vs. DXC Technology |
| NVIDIA vs. Grupo Sports World | NVIDIA vs. Air Transport Services | NVIDIA vs. McEwen Mining | NVIDIA vs. UnitedHealth Group Incorporated |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| CEOs Directory Screen CEOs from public companies around the world | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |