Correlation Between MELIA HOTELS and Anglo American
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By analyzing existing cross correlation between MELIA HOTELS and Anglo American plc, you can compare the effects of market volatilities on MELIA HOTELS and Anglo American 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 MELIA HOTELS with a short position of Anglo American. Check out your portfolio center. Please also check ongoing floating volatility patterns of MELIA HOTELS and Anglo American.
Diversification Opportunities for MELIA HOTELS and Anglo American
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between MELIA and Anglo is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding MELIA HOTELS and Anglo American plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anglo American plc and MELIA 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 MELIA HOTELS are associated (or correlated) with Anglo American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anglo American plc has no effect on the direction of MELIA HOTELS i.e., MELIA HOTELS and Anglo American go up and down completely randomly.
Pair Corralation between MELIA HOTELS and Anglo American
Assuming the 90 days trading horizon MELIA HOTELS is expected to generate 12.53 times less return on investment than Anglo American. In addition to that, MELIA HOTELS is 1.12 times more volatile than Anglo American plc. It trades about 0.02 of its total potential returns per unit of risk. Anglo American plc is currently generating about 0.35 per unit of volatility. If you would invest 2,677 in Anglo American plc on September 14, 2024 and sell it today you would earn a total of 396.00 from holding Anglo American plc or generate 14.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MELIA HOTELS vs. Anglo American plc
Performance |
| Timeline |
| MELIA HOTELS |
| Anglo American plc |
MELIA HOTELS and Anglo American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MELIA HOTELS and Anglo American
The main advantage of trading using opposite MELIA HOTELS and Anglo American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MELIA HOTELS position performs unexpectedly, Anglo American 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 Anglo American will offset losses from the drop in Anglo American's long position.| MELIA HOTELS vs. Apple Inc | MELIA HOTELS vs. Apple Inc | MELIA HOTELS vs. Apple Inc | MELIA HOTELS vs. Apple Inc |
| Anglo American vs. MELIA HOTELS | Anglo American vs. Nok Airlines PCL | Anglo American vs. International Consolidated Airlines | Anglo American vs. Park Hotels Resorts |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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