Correlation Between InterContinental and MOVIE GAMES
Can any of the company-specific risk be diversified away by investing in both InterContinental and MOVIE GAMES 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 InterContinental and MOVIE GAMES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between InterContinental Hotels Group and MOVIE GAMES SA, you can compare the effects of market volatilities on InterContinental and MOVIE GAMES 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 InterContinental with a short position of MOVIE GAMES. Check out your portfolio center. Please also check ongoing floating volatility patterns of InterContinental and MOVIE GAMES.
Diversification Opportunities for InterContinental and MOVIE GAMES
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between InterContinental and MOVIE is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding InterContinental Hotels Group and MOVIE GAMES SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MOVIE GAMES SA and InterContinental 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 InterContinental Hotels Group are associated (or correlated) with MOVIE GAMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MOVIE GAMES SA has no effect on the direction of InterContinental i.e., InterContinental and MOVIE GAMES go up and down completely randomly.
Pair Corralation between InterContinental and MOVIE GAMES
Assuming the 90 days trading horizon InterContinental Hotels Group is expected to generate 0.36 times more return on investment than MOVIE GAMES. However, InterContinental Hotels Group is 2.8 times less risky than MOVIE GAMES. It trades about 0.11 of its potential returns per unit of risk. MOVIE GAMES SA is currently generating about 0.01 per unit of risk. If you would invest 5,571 in InterContinental Hotels Group on September 2, 2024 and sell it today you would earn a total of 6,229 from holding InterContinental Hotels Group or generate 111.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
InterContinental Hotels Group vs. MOVIE GAMES SA
Performance |
| Timeline |
| InterContinental Hotels |
| MOVIE GAMES SA |
InterContinental and MOVIE GAMES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with InterContinental and MOVIE GAMES
The main advantage of trading using opposite InterContinental and MOVIE GAMES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if InterContinental position performs unexpectedly, MOVIE GAMES 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 MOVIE GAMES will offset losses from the drop in MOVIE GAMES's long position.| InterContinental vs. Micron Technology | InterContinental vs. GALENA MINING LTD | InterContinental vs. Zijin Mining Group | InterContinental vs. Vishay Intertechnology |
| MOVIE GAMES vs. Apple Inc | MOVIE GAMES vs. Apple Inc | MOVIE GAMES vs. Apple Inc | MOVIE GAMES vs. Apple Inc |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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