Correlation Between Grupo Hotelero and RLH Properties
Can any of the company-specific risk be diversified away by investing in both Grupo Hotelero and RLH Properties 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 RLH Properties 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 RLH Properties SAB, you can compare the effects of market volatilities on Grupo Hotelero and RLH Properties 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 RLH Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Hotelero and RLH Properties.
Diversification Opportunities for Grupo Hotelero and RLH Properties
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Grupo and RLH is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Hotelero Santa and RLH Properties SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RLH Properties SAB 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 RLH Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RLH Properties SAB has no effect on the direction of Grupo Hotelero i.e., Grupo Hotelero and RLH Properties go up and down completely randomly.
Pair Corralation between Grupo Hotelero and RLH Properties
Assuming the 90 days trading horizon Grupo Hotelero Santa is expected to generate 8.14 times more return on investment than RLH Properties. However, Grupo Hotelero is 8.14 times more volatile than RLH Properties SAB. It trades about 0.06 of its potential returns per unit of risk. RLH Properties SAB is currently generating about -0.12 per unit of risk. If you would invest 350.00 in Grupo Hotelero Santa on September 3, 2024 and sell it today you would earn a total of 50.00 from holding Grupo Hotelero Santa or generate 14.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Grupo Hotelero Santa vs. RLH Properties SAB
Performance |
| Timeline |
| Grupo Hotelero Santa |
| RLH Properties SAB |
Grupo Hotelero and RLH Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Hotelero and RLH Properties
The main advantage of trading using opposite Grupo Hotelero and RLH Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Hotelero position performs unexpectedly, RLH Properties 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 RLH Properties will offset losses from the drop in RLH Properties' long position.| Grupo Hotelero vs. Axtel SAB de | Grupo Hotelero vs. Fomento Econmico Mexicano | Grupo Hotelero vs. Lloyds Banking Group | Grupo Hotelero vs. Apple Inc |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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