Correlation Between Hotel Majestic and NSC Groupe
Can any of the company-specific risk be diversified away by investing in both Hotel Majestic and NSC Groupe 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 Hotel Majestic and NSC Groupe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hotel Majestic Cannes and NSC Groupe SA, you can compare the effects of market volatilities on Hotel Majestic and NSC Groupe 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 Hotel Majestic with a short position of NSC Groupe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hotel Majestic and NSC Groupe.
Diversification Opportunities for Hotel Majestic and NSC Groupe
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hotel and NSC is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Hotel Majestic Cannes and NSC Groupe SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NSC Groupe SA and Hotel Majestic 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 Hotel Majestic Cannes are associated (or correlated) with NSC Groupe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NSC Groupe SA has no effect on the direction of Hotel Majestic i.e., Hotel Majestic and NSC Groupe go up and down completely randomly.
Pair Corralation between Hotel Majestic and NSC Groupe
If you would invest 520,000 in Hotel Majestic Cannes on September 13, 2024 and sell it today you would earn a total of 0.00 from holding Hotel Majestic Cannes or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hotel Majestic Cannes vs. NSC Groupe SA
Performance |
| Timeline |
| Hotel Majestic Cannes |
| NSC Groupe SA |
Hotel Majestic and NSC Groupe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hotel Majestic and NSC Groupe
The main advantage of trading using opposite Hotel Majestic and NSC Groupe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hotel Majestic position performs unexpectedly, NSC Groupe 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 NSC Groupe will offset losses from the drop in NSC Groupe's long position.The idea behind Hotel Majestic Cannes and NSC Groupe SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| NSC Groupe vs. Thermador Groupe SA | NSC Groupe vs. Samse SA | NSC Groupe vs. Rubis SCA | NSC Groupe vs. Trigano SA |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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