Correlation Between Gigas Hosting and NH Hoteles
Can any of the company-specific risk be diversified away by investing in both Gigas Hosting and NH Hoteles 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 Gigas Hosting and NH Hoteles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gigas Hosting SA and NH Hoteles, you can compare the effects of market volatilities on Gigas Hosting and NH Hoteles 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 Gigas Hosting with a short position of NH Hoteles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gigas Hosting and NH Hoteles.
Diversification Opportunities for Gigas Hosting and NH Hoteles
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Gigas and NHH is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Gigas Hosting SA and NH Hoteles in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NH Hoteles and Gigas Hosting 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 Gigas Hosting SA are associated (or correlated) with NH Hoteles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NH Hoteles has no effect on the direction of Gigas Hosting i.e., Gigas Hosting and NH Hoteles go up and down completely randomly.
Pair Corralation between Gigas Hosting and NH Hoteles
Assuming the 90 days trading horizon Gigas Hosting SA is expected to under-perform the NH Hoteles. But the stock apears to be less risky and, when comparing its historical volatility, Gigas Hosting SA is 1.62 times less risky than NH Hoteles. The stock trades about -0.04 of its potential returns per unit of risk. The NH Hoteles is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 408.00 in NH Hoteles on November 3, 2024 and sell it today you would earn a total of 222.00 from holding NH Hoteles or generate 54.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gigas Hosting SA vs. NH Hoteles
Performance |
| Timeline |
| Gigas Hosting SA |
| NH Hoteles |
Gigas Hosting and NH Hoteles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gigas Hosting and NH Hoteles
The main advantage of trading using opposite Gigas Hosting and NH Hoteles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gigas Hosting position performs unexpectedly, NH Hoteles 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 NH Hoteles will offset losses from the drop in NH Hoteles' long position.| Gigas Hosting vs. Naturhouse Health SA | Gigas Hosting vs. Neinor Homes SLU | Gigas Hosting vs. Vytrus Biotech SA | Gigas Hosting vs. Inhome Prime Properties |
| NH Hoteles vs. Melia Hotels | NH Hoteles vs. Indra A | NH Hoteles vs. Fomento de Construcciones | NH Hoteles vs. Acerinox |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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