Correlation Between JAPAN AIRLINES and MHP Hotel
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By analyzing existing cross correlation between JAPAN AIRLINES and MHP Hotel AG, you can compare the effects of market volatilities on JAPAN AIRLINES and MHP Hotel 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 JAPAN AIRLINES with a short position of MHP Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of JAPAN AIRLINES and MHP Hotel.
Diversification Opportunities for JAPAN AIRLINES and MHP Hotel
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between JAPAN and MHP is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding JAPAN AIRLINES and MHP Hotel AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MHP Hotel AG and JAPAN AIRLINES 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 JAPAN AIRLINES are associated (or correlated) with MHP Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MHP Hotel AG has no effect on the direction of JAPAN AIRLINES i.e., JAPAN AIRLINES and MHP Hotel go up and down completely randomly.
Pair Corralation between JAPAN AIRLINES and MHP Hotel
Assuming the 90 days trading horizon JAPAN AIRLINES is expected to under-perform the MHP Hotel. But the stock apears to be less risky and, when comparing its historical volatility, JAPAN AIRLINES is 1.94 times less risky than MHP Hotel. The stock trades about -0.02 of its potential returns per unit of risk. The MHP Hotel AG is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 112.00 in MHP Hotel AG on October 27, 2024 and sell it today you would earn a total of 15.00 from holding MHP Hotel AG or generate 13.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JAPAN AIRLINES vs. MHP Hotel AG
Performance |
| Timeline |
| JAPAN AIRLINES |
| MHP Hotel AG |
JAPAN AIRLINES and MHP Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JAPAN AIRLINES and MHP Hotel
The main advantage of trading using opposite JAPAN AIRLINES and MHP Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JAPAN AIRLINES position performs unexpectedly, MHP Hotel 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 MHP Hotel will offset losses from the drop in MHP Hotel's long position.| JAPAN AIRLINES vs. Apple Inc | JAPAN AIRLINES vs. Apple Inc | JAPAN AIRLINES vs. Apple Inc | JAPAN AIRLINES vs. Apple Inc |
| MHP Hotel vs. DXC Technology Co | MHP Hotel vs. Micron Technology | MHP Hotel vs. Hemisphere Energy Corp | MHP Hotel vs. SEALED AIR |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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