Correlation Between Meliá Hotels and ANTA Sports
Can any of the company-specific risk be diversified away by investing in both Meliá Hotels and ANTA Sports 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 Meliá Hotels and ANTA Sports 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 ANTA Sports Products, you can compare the effects of market volatilities on Meliá Hotels and ANTA Sports 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 Meliá Hotels with a short position of ANTA Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meliá Hotels and ANTA Sports.
Diversification Opportunities for Meliá Hotels and ANTA Sports
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Meliá and ANTA is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Meli Hotels International and ANTA Sports Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANTA Sports Products and Meliá 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 ANTA Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANTA Sports Products has no effect on the direction of Meliá Hotels i.e., Meliá Hotels and ANTA Sports go up and down completely randomly.
Pair Corralation between Meliá Hotels and ANTA Sports
Assuming the 90 days horizon Meli Hotels International is expected to generate 0.62 times more return on investment than ANTA Sports. However, Meli Hotels International is 1.62 times less risky than ANTA Sports. It trades about 0.03 of its potential returns per unit of risk. ANTA Sports Products is currently generating about 0.02 per unit of risk. If you would invest 598.00 in Meli Hotels International on October 14, 2024 and sell it today you would earn a total of 122.00 from holding Meli Hotels International or generate 20.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Meli Hotels International vs. ANTA Sports Products
Performance |
| Timeline |
| Meli Hotels International |
| ANTA Sports Products |
Meliá Hotels and ANTA Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meliá Hotels and ANTA Sports
The main advantage of trading using opposite Meliá Hotels and ANTA Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meliá Hotels position performs unexpectedly, ANTA Sports 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 ANTA Sports will offset losses from the drop in ANTA Sports' long position.| Meliá Hotels vs. Park Hotels Resorts | Meliá Hotels vs. Hyatt Hotels | Meliá Hotels vs. Liberty Broadband | Meliá Hotels vs. COMPUTERSHARE |
| ANTA Sports vs. MHP Hotel AG | ANTA Sports vs. ASPEN TECHINC DL | ANTA Sports vs. Meli Hotels International | ANTA Sports vs. NH HOTEL GROUP |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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