Correlation Between Mondee Holdings and Despegar Corp
Can any of the company-specific risk be diversified away by investing in both Mondee Holdings and Despegar Corp 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 Mondee Holdings and Despegar Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mondee Holdings and Despegar Corp, you can compare the effects of market volatilities on Mondee Holdings and Despegar Corp 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 Mondee Holdings with a short position of Despegar Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mondee Holdings and Despegar Corp.
Diversification Opportunities for Mondee Holdings and Despegar Corp
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mondee and Despegar is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Mondee Holdings and Despegar Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Despegar Corp and Mondee Holdings 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 Mondee Holdings are associated (or correlated) with Despegar Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Despegar Corp has no effect on the direction of Mondee Holdings i.e., Mondee Holdings and Despegar Corp go up and down completely randomly.
Pair Corralation between Mondee Holdings and Despegar Corp
Given the investment horizon of 90 days Mondee Holdings is expected to under-perform the Despegar Corp. In addition to that, Mondee Holdings is 1.66 times more volatile than Despegar Corp. It trades about -0.09 of its total potential returns per unit of risk. Despegar Corp is currently generating about 0.1 per unit of volatility. If you would invest 646.00 in Despegar Corp on August 27, 2024 and sell it today you would earn a total of 1,229 from holding Despegar Corp or generate 190.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mondee Holdings vs. Despegar Corp
Performance |
| Timeline |
| Mondee Holdings |
| Despegar Corp |
Mondee Holdings and Despegar Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mondee Holdings and Despegar Corp
The main advantage of trading using opposite Mondee Holdings and Despegar Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mondee Holdings position performs unexpectedly, Despegar Corp 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 Despegar Corp will offset losses from the drop in Despegar Corp's long position.| Mondee Holdings vs. Yatra Online | Mondee Holdings vs. Despegar Corp | Mondee Holdings vs. Lindblad Expeditions Holdings | Mondee Holdings vs. MakeMyTrip Limited |
| Despegar Corp vs. Yatra Online | Despegar Corp vs. Lindblad Expeditions Holdings | Despegar Corp vs. Mondee Holdings | Despegar Corp vs. Expedia 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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