Correlation Between Sixt Leasing and Host Hotels
Can any of the company-specific risk be diversified away by investing in both Sixt Leasing and Host 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 Sixt Leasing and Host Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sixt Leasing SE and Host Hotels Resorts, you can compare the effects of market volatilities on Sixt Leasing and Host 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 Sixt Leasing with a short position of Host Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sixt Leasing and Host Hotels.
Diversification Opportunities for Sixt Leasing and Host Hotels
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sixt and Host is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Sixt Leasing SE and Host Hotels Resorts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Host Hotels Resorts and Sixt Leasing 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 Sixt Leasing SE are associated (or correlated) with Host Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Host Hotels Resorts has no effect on the direction of Sixt Leasing i.e., Sixt Leasing and Host Hotels go up and down completely randomly.
Pair Corralation between Sixt Leasing and Host Hotels
Assuming the 90 days trading horizon Sixt Leasing SE is expected to under-perform the Host Hotels. But the stock apears to be less risky and, when comparing its historical volatility, Sixt Leasing SE is 1.27 times less risky than Host Hotels. The stock trades about -0.17 of its potential returns per unit of risk. The Host Hotels Resorts is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,610 in Host Hotels Resorts on August 28, 2024 and sell it today you would earn a total of 110.00 from holding Host Hotels Resorts or generate 6.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sixt Leasing SE vs. Host Hotels Resorts
Performance |
| Timeline |
| Sixt Leasing SE |
| Host Hotels Resorts |
Sixt Leasing and Host Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sixt Leasing and Host Hotels
The main advantage of trading using opposite Sixt Leasing and Host Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sixt Leasing position performs unexpectedly, Host 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 Host Hotels will offset losses from the drop in Host Hotels' long position.| Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc |
| Host Hotels vs. VIAPLAY GROUP AB | Host Hotels vs. CVW CLEANTECH INC | Host Hotels vs. COLUMBIA SPORTSWEAR | Host Hotels vs. ANTA SPORTS PRODUCT |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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