Correlation Between MELIA HOTELS and Socit Gnrale
Can any of the company-specific risk be diversified away by investing in both MELIA HOTELS and Socit Gnrale 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 MELIA HOTELS and Socit Gnrale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MELIA HOTELS and Socit Gnrale Socit, you can compare the effects of market volatilities on MELIA HOTELS and Socit Gnrale 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 Socit Gnrale. Check out your portfolio center. Please also check ongoing floating volatility patterns of MELIA HOTELS and Socit Gnrale.
Diversification Opportunities for MELIA HOTELS and Socit Gnrale
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between MELIA and Socit is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding MELIA HOTELS and Socit Gnrale Socit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Socit Gnrale Socit 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 Socit Gnrale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Socit Gnrale Socit has no effect on the direction of MELIA HOTELS i.e., MELIA HOTELS and Socit Gnrale go up and down completely randomly.
Pair Corralation between MELIA HOTELS and Socit Gnrale
Assuming the 90 days trading horizon MELIA HOTELS is expected to generate 1.14 times less return on investment than Socit Gnrale. In addition to that, MELIA HOTELS is 1.09 times more volatile than Socit Gnrale Socit. It trades about 0.02 of its total potential returns per unit of risk. Socit Gnrale Socit is currently generating about 0.03 per unit of volatility. If you would invest 2,497 in Socit Gnrale Socit on October 25, 2024 and sell it today you would earn a total of 435.00 from holding Socit Gnrale Socit or generate 17.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MELIA HOTELS vs. Socit Gnrale Socit
Performance |
| Timeline |
| MELIA HOTELS |
| Socit Gnrale Socit |
MELIA HOTELS and Socit Gnrale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MELIA HOTELS and Socit Gnrale
The main advantage of trading using opposite MELIA HOTELS and Socit Gnrale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MELIA HOTELS position performs unexpectedly, Socit Gnrale 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 Socit Gnrale will offset losses from the drop in Socit Gnrale's long position.| MELIA HOTELS vs. Apple Inc | MELIA HOTELS vs. Apple Inc | MELIA HOTELS vs. Apple Inc | MELIA HOTELS vs. Apple Inc |
| Socit Gnrale vs. CyberArk Software | Socit Gnrale vs. AXWAY SOFTWARE EO | Socit Gnrale vs. VIRGIN WINES UK | Socit Gnrale vs. Teradata Corp |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |