Correlation Between INTERCONT HOTELS and Deutsche Telekom
Can any of the company-specific risk be diversified away by investing in both INTERCONT HOTELS and Deutsche Telekom 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 INTERCONT HOTELS and Deutsche Telekom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INTERCONT HOTELS and Deutsche Telekom AG, you can compare the effects of market volatilities on INTERCONT HOTELS and Deutsche Telekom 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 INTERCONT HOTELS with a short position of Deutsche Telekom. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTERCONT HOTELS and Deutsche Telekom.
Diversification Opportunities for INTERCONT HOTELS and Deutsche Telekom
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between INTERCONT and Deutsche is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding INTERCONT HOTELS and Deutsche Telekom AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Telekom and INTERCONT 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 INTERCONT HOTELS are associated (or correlated) with Deutsche Telekom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Telekom has no effect on the direction of INTERCONT HOTELS i.e., INTERCONT HOTELS and Deutsche Telekom go up and down completely randomly.
Pair Corralation between INTERCONT HOTELS and Deutsche Telekom
Assuming the 90 days trading horizon INTERCONT HOTELS is expected to generate 0.62 times more return on investment than Deutsche Telekom. However, INTERCONT HOTELS is 1.61 times less risky than Deutsche Telekom. It trades about 0.0 of its potential returns per unit of risk. Deutsche Telekom AG is currently generating about -0.14 per unit of risk. If you would invest 11,900 in INTERCONT HOTELS on October 17, 2024 and sell it today you would earn a total of 0.00 from holding INTERCONT HOTELS or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
INTERCONT HOTELS vs. Deutsche Telekom AG
Performance |
| Timeline |
| INTERCONT HOTELS |
| Deutsche Telekom |
INTERCONT HOTELS and Deutsche Telekom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTERCONT HOTELS and Deutsche Telekom
The main advantage of trading using opposite INTERCONT HOTELS and Deutsche Telekom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTERCONT HOTELS position performs unexpectedly, Deutsche Telekom 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 Deutsche Telekom will offset losses from the drop in Deutsche Telekom's long position.| INTERCONT HOTELS vs. Packaging of | INTERCONT HOTELS vs. ERSTE GP BNK | INTERCONT HOTELS vs. W R Berkley | INTERCONT HOTELS vs. News Corporation |
| Deutsche Telekom vs. MELIA HOTELS | Deutsche Telekom vs. InterContinental Hotels Group | Deutsche Telekom vs. Monster Beverage Corp | Deutsche Telekom vs. INTERCONT HOTELS |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |