Correlation Between Grupo Hotelero and Intel
Can any of the company-specific risk be diversified away by investing in both Grupo Hotelero and Intel 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 Grupo Hotelero and Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Hotelero Santa and Intel, you can compare the effects of market volatilities on Grupo Hotelero and Intel 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 Grupo Hotelero with a short position of Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Hotelero and Intel.
Diversification Opportunities for Grupo Hotelero and Intel
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Grupo and Intel is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Hotelero Santa and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel and Grupo Hotelero 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 Grupo Hotelero Santa are associated (or correlated) with Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of Grupo Hotelero i.e., Grupo Hotelero and Intel go up and down completely randomly.
Pair Corralation between Grupo Hotelero and Intel
Assuming the 90 days trading horizon Grupo Hotelero Santa is expected to under-perform the Intel. But the stock apears to be less risky and, when comparing its historical volatility, Grupo Hotelero Santa is 2.47 times less risky than Intel. The stock trades about -0.06 of its potential returns per unit of risk. The Intel is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 41,930 in Intel on November 28, 2024 and sell it today you would earn a total of 5,870 from holding Intel or generate 14.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Hotelero Santa vs. Intel
Performance |
| Timeline |
| Grupo Hotelero Santa |
| Intel |
Grupo Hotelero and Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Hotelero and Intel
The main advantage of trading using opposite Grupo Hotelero and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Hotelero position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.| Grupo Hotelero vs. United States Steel | Grupo Hotelero vs. Monster Beverage Corp | Grupo Hotelero vs. McEwen Mining | Grupo Hotelero vs. United Airlines Holdings |
| Intel vs. Grupo Sports World | Intel vs. Taiwan Semiconductor Manufacturing | Intel vs. Martin Marietta Materials | Intel vs. Grupo Industrial Saltillo |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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