Correlation Between Meli Hotels and SIRIUS XM
Can any of the company-specific risk be diversified away by investing in both Meli Hotels and SIRIUS XM 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 SIRIUS XM 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 SIRIUS XM RADIO, you can compare the effects of market volatilities on Meli Hotels and SIRIUS XM 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 SIRIUS XM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meli Hotels and SIRIUS XM.
Diversification Opportunities for Meli Hotels and SIRIUS XM
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Meli and SIRIUS is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Meli Hotels International and SIRIUS XM RADIO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIRIUS XM RADIO 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 SIRIUS XM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIRIUS XM RADIO has no effect on the direction of Meli Hotels i.e., Meli Hotels and SIRIUS XM go up and down completely randomly.
Pair Corralation between Meli Hotels and SIRIUS XM
Assuming the 90 days horizon Meli Hotels is expected to generate 2.62 times less return on investment than SIRIUS XM. But when comparing it to its historical volatility, Meli Hotels International is 1.17 times less risky than SIRIUS XM. It trades about 0.18 of its potential returns per unit of risk. SIRIUS XM RADIO is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest 2,101 in SIRIUS XM RADIO on November 18, 2024 and sell it today you would earn a total of 355.00 from holding SIRIUS XM RADIO or generate 16.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Meli Hotels International vs. SIRIUS XM RADIO
Performance |
| Timeline |
| Meli Hotels International |
| SIRIUS XM RADIO |
Meli Hotels and SIRIUS XM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meli Hotels and SIRIUS XM
The main advantage of trading using opposite Meli Hotels and SIRIUS XM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meli Hotels position performs unexpectedly, SIRIUS XM 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 SIRIUS XM will offset losses from the drop in SIRIUS XM's long position.| Meli Hotels vs. CITIC Telecom International | Meli Hotels vs. Martin Marietta Materials | Meli Hotels vs. Rayonier Advanced Materials | Meli Hotels vs. Plastic Omnium |
| SIRIUS XM vs. RYU Apparel | SIRIUS XM vs. GUILD ESPORTS PLC | SIRIUS XM vs. SPORTING | SIRIUS XM vs. TITANIUM TRANSPORTGROUP |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |