Correlation Between Meli Hotels and INTUITIVE INVGRP
Can any of the company-specific risk be diversified away by investing in both Meli Hotels and INTUITIVE INVGRP 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 INTUITIVE INVGRP 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 INTUITIVE INVGRP LS, you can compare the effects of market volatilities on Meli Hotels and INTUITIVE INVGRP 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 INTUITIVE INVGRP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meli Hotels and INTUITIVE INVGRP.
Diversification Opportunities for Meli Hotels and INTUITIVE INVGRP
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Meli and INTUITIVE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Meli Hotels International and INTUITIVE INVGRP LS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTUITIVE INVGRP 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 INTUITIVE INVGRP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTUITIVE INVGRP has no effect on the direction of Meli Hotels i.e., Meli Hotels and INTUITIVE INVGRP go up and down completely randomly.
Pair Corralation between Meli Hotels and INTUITIVE INVGRP
Assuming the 90 days horizon Meli Hotels is expected to generate 50.3 times less return on investment than INTUITIVE INVGRP. But when comparing it to its historical volatility, Meli Hotels International is 42.88 times less risky than INTUITIVE INVGRP. It trades about 0.06 of its potential returns per unit of risk. INTUITIVE INVGRP LS is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 134.00 in INTUITIVE INVGRP LS on August 24, 2024 and sell it today you would lose (121.00) from holding INTUITIVE INVGRP LS or give up 90.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Meli Hotels International vs. INTUITIVE INVGRP LS
Performance |
| Timeline |
| Meli Hotels International |
| INTUITIVE INVGRP |
Meli Hotels and INTUITIVE INVGRP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meli Hotels and INTUITIVE INVGRP
The main advantage of trading using opposite Meli Hotels and INTUITIVE INVGRP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meli Hotels position performs unexpectedly, INTUITIVE INVGRP 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 INTUITIVE INVGRP will offset losses from the drop in INTUITIVE INVGRP's long position.| Meli Hotels vs. MOLSON RS BEVERAGE | Meli Hotels vs. International Consolidated Airlines | Meli Hotels vs. THAI BEVERAGE | Meli Hotels vs. Cal Maine Foods |
| INTUITIVE INVGRP vs. Dairy Farm International | INTUITIVE INVGRP vs. INDOFOOD AGRI RES | INTUITIVE INVGRP vs. Performance Food Group | INTUITIVE INVGRP vs. GungHo Online Entertainment |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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