Correlation Between Hotel Property and ABACUS STORAGE

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Can any of the company-specific risk be diversified away by investing in both Hotel Property and ABACUS STORAGE 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 Hotel Property and ABACUS STORAGE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hotel Property Investments and ABACUS STORAGE KING, you can compare the effects of market volatilities on Hotel Property and ABACUS STORAGE 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 Hotel Property with a short position of ABACUS STORAGE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hotel Property and ABACUS STORAGE.

Diversification Opportunities for Hotel Property and ABACUS STORAGE

HotelABACUSDiversified AwayHotelABACUSDiversified Away100%
-0.42
  Correlation Coefficient

Very good diversification

The 3 months correlation between Hotel and ABACUS is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Hotel Property Investments and ABACUS STORAGE KING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ABACUS STORAGE KING and Hotel Property 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 Hotel Property Investments are associated (or correlated) with ABACUS STORAGE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ABACUS STORAGE KING has no effect on the direction of Hotel Property i.e., Hotel Property and ABACUS STORAGE go up and down completely randomly.

Pair Corralation between Hotel Property and ABACUS STORAGE

Assuming the 90 days trading horizon Hotel Property Investments is expected to generate 0.75 times more return on investment than ABACUS STORAGE. However, Hotel Property Investments is 1.33 times less risky than ABACUS STORAGE. It trades about 0.07 of its potential returns per unit of risk. ABACUS STORAGE KING is currently generating about 0.02 per unit of risk. If you would invest  311.00  in Hotel Property Investments on November 21, 2024 and sell it today you would earn a total of  65.00  from holding Hotel Property Investments or generate 20.9% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Hotel Property Investments  vs.  ABACUS STORAGE KING

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -50510
JavaScript chart by amCharts 3.21.15HPI ASK
       Timeline  
Hotel Property Inves 

Risk-Adjusted Performance

OK

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Hotel Property Investments are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable forward indicators, Hotel Property is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb3.63.653.73.753.83.85
ABACUS STORAGE KING 

Risk-Adjusted Performance

Modest

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in ABACUS STORAGE KING are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain forward-looking signals, ABACUS STORAGE may actually be approaching a critical reversion point that can send shares even higher in March 2025.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb1.11.121.141.161.181.21.221.24

Hotel Property and ABACUS STORAGE Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-2.0-1.47-0.94-0.410.08150.591.121.652.18 0.20.40.60.8
JavaScript chart by amCharts 3.21.15HPI ASK
       Returns  

Pair Trading with Hotel Property and ABACUS STORAGE

The main advantage of trading using opposite Hotel Property and ABACUS STORAGE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hotel Property position performs unexpectedly, ABACUS STORAGE 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 ABACUS STORAGE will offset losses from the drop in ABACUS STORAGE's long position.
The idea behind Hotel Property Investments and ABACUS STORAGE KING pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.

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