Correlation Between Hyrican Informationssyst and Xenia Hotels
Can any of the company-specific risk be diversified away by investing in both Hyrican Informationssyst and Xenia Hotels 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 Hyrican Informationssyst and Xenia Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyrican Informationssysteme Aktiengesellschaft and Xenia Hotels Resorts, you can compare the effects of market volatilities on Hyrican Informationssyst and Xenia Hotels 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 Hyrican Informationssyst with a short position of Xenia Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyrican Informationssyst and Xenia Hotels.
Diversification Opportunities for Hyrican Informationssyst and Xenia Hotels
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hyrican and Xenia is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Hyrican Informationssysteme Ak and Xenia Hotels Resorts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xenia Hotels Resorts and Hyrican Informationssyst 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 Hyrican Informationssysteme Aktiengesellschaft are associated (or correlated) with Xenia Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xenia Hotels Resorts has no effect on the direction of Hyrican Informationssyst i.e., Hyrican Informationssyst and Xenia Hotels go up and down completely randomly.
Pair Corralation between Hyrican Informationssyst and Xenia Hotels
Assuming the 90 days horizon Hyrican Informationssyst is expected to generate 1.28 times less return on investment than Xenia Hotels. But when comparing it to its historical volatility, Hyrican Informationssysteme Aktiengesellschaft is 2.57 times less risky than Xenia Hotels. It trades about 0.22 of its potential returns per unit of risk. Xenia Hotels Resorts is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,330 in Xenia Hotels Resorts on August 30, 2024 and sell it today you would earn a total of 130.00 from holding Xenia Hotels Resorts or generate 9.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyrican Informationssysteme Ak vs. Xenia Hotels Resorts
Performance |
| Timeline |
| Hyrican Informationssyst |
| Xenia Hotels Resorts |
Hyrican Informationssyst and Xenia Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyrican Informationssyst and Xenia Hotels
The main advantage of trading using opposite Hyrican Informationssyst and Xenia Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyrican Informationssyst position performs unexpectedly, Xenia Hotels 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 Xenia Hotels will offset losses from the drop in Xenia Hotels' long position.| Hyrican Informationssyst vs. Arista Networks | Hyrican Informationssyst vs. Seiko Epson | Hyrican Informationssyst vs. Superior Plus Corp | Hyrican Informationssyst vs. SIVERS SEMICONDUCTORS AB |
| Xenia Hotels vs. Host Hotels Resorts | Xenia Hotels vs. Sunstone Hotel Investors | Xenia Hotels vs. Summit Hotel Properties |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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