Correlation Between Host Hotels and Jacquet Metal
Can any of the company-specific risk be diversified away by investing in both Host Hotels and Jacquet Metal 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 Host Hotels and Jacquet Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Host Hotels Resorts and Jacquet Metal Service, you can compare the effects of market volatilities on Host Hotels and Jacquet Metal 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 Host Hotels with a short position of Jacquet Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Host Hotels and Jacquet Metal.
Diversification Opportunities for Host Hotels and Jacquet Metal
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Host and Jacquet is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Host Hotels Resorts and Jacquet Metal Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jacquet Metal Service and Host Hotels 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 Host Hotels Resorts are associated (or correlated) with Jacquet Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jacquet Metal Service has no effect on the direction of Host Hotels i.e., Host Hotels and Jacquet Metal go up and down completely randomly.
Pair Corralation between Host Hotels and Jacquet Metal
Assuming the 90 days horizon Host Hotels Resorts is expected to generate 1.65 times more return on investment than Jacquet Metal. However, Host Hotels is 1.65 times more volatile than Jacquet Metal Service. It trades about 0.15 of its potential returns per unit of risk. Jacquet Metal Service is currently generating about -0.18 per unit of risk. If you would invest 1,610 in Host Hotels Resorts on August 29, 2024 and sell it today you would earn a total of 120.00 from holding Host Hotels Resorts or generate 7.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Host Hotels Resorts vs. Jacquet Metal Service
Performance |
| Timeline |
| Host Hotels Resorts |
| Jacquet Metal Service |
Host Hotels and Jacquet Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Host Hotels and Jacquet Metal
The main advantage of trading using opposite Host Hotels and Jacquet Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Host Hotels position performs unexpectedly, Jacquet Metal 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 Jacquet Metal will offset losses from the drop in Jacquet Metal's long position.| Host Hotels vs. VIAPLAY GROUP AB | Host Hotels vs. CVW CLEANTECH INC | Host Hotels vs. COLUMBIA SPORTSWEAR | Host Hotels vs. ANTA SPORTS PRODUCT |
| Jacquet Metal vs. Marie Brizard Wine | Jacquet Metal vs. Treasury Wine Estates | Jacquet Metal vs. GEELY AUTOMOBILE | Jacquet Metal vs. Gol Intelligent Airlines |
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.
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