Correlation Between Meli Hotels and QUEEN S
Can any of the company-specific risk be diversified away by investing in both Meli Hotels and QUEEN S 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 Meli Hotels and QUEEN S into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Meli Hotels International and QUEEN S ROAD, you can compare the effects of market volatilities on Meli Hotels and QUEEN S 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 Meli Hotels with a short position of QUEEN S. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meli Hotels and QUEEN S.
Diversification Opportunities for Meli Hotels and QUEEN S
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Meli and QUEEN is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Meli Hotels International and QUEEN S ROAD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QUEEN S ROAD and Meli 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 Meli Hotels International are associated (or correlated) with QUEEN S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QUEEN S ROAD has no effect on the direction of Meli Hotels i.e., Meli Hotels and QUEEN S go up and down completely randomly.
Pair Corralation between Meli Hotels and QUEEN S
Assuming the 90 days horizon Meli Hotels International is expected to generate 0.4 times more return on investment than QUEEN S. However, Meli Hotels International is 2.51 times less risky than QUEEN S. It trades about 0.06 of its potential returns per unit of risk. QUEEN S ROAD is currently generating about -0.04 per unit of risk. If you would invest 671.00 in Meli Hotels International on October 30, 2024 and sell it today you would earn a total of 24.00 from holding Meli Hotels International or generate 3.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Meli Hotels International vs. QUEEN S ROAD
Performance |
| Timeline |
| Meli Hotels International |
| QUEEN S ROAD |
Meli Hotels and QUEEN S Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meli Hotels and QUEEN S
The main advantage of trading using opposite Meli Hotels and QUEEN S positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meli Hotels position performs unexpectedly, QUEEN S 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 QUEEN S will offset losses from the drop in QUEEN S's long position.| Meli Hotels vs. MCEWEN MINING INC | Meli Hotels vs. Entravision Communications | Meli Hotels vs. CARSALESCOM | Meli Hotels vs. GEELY AUTOMOBILE |
| QUEEN S vs. Blackstone Group | QUEEN S vs. The Bank of | QUEEN S vs. Ameriprise Financial | QUEEN S vs. State Street |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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