Correlation Between Nine Entertainment and Hotel Property
Can any of the company-specific risk be diversified away by investing in both Nine Entertainment and Hotel Property 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 Nine Entertainment and Hotel Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nine Entertainment Co and Hotel Property Investments, you can compare the effects of market volatilities on Nine Entertainment and Hotel Property 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 Nine Entertainment with a short position of Hotel Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nine Entertainment and Hotel Property.
Diversification Opportunities for Nine Entertainment and Hotel Property
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Nine and Hotel is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Nine Entertainment Co and Hotel Property Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hotel Property Inves and Nine Entertainment 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 Nine Entertainment Co are associated (or correlated) with Hotel Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hotel Property Inves has no effect on the direction of Nine Entertainment i.e., Nine Entertainment and Hotel Property go up and down completely randomly.
Pair Corralation between Nine Entertainment and Hotel Property
Assuming the 90 days trading horizon Nine Entertainment Co is expected to under-perform the Hotel Property. In addition to that, Nine Entertainment is 1.28 times more volatile than Hotel Property Investments. It trades about -0.07 of its total potential returns per unit of risk. Hotel Property Investments is currently generating about 0.12 per unit of volatility. If you would invest 251.00 in Hotel Property Investments on August 29, 2024 and sell it today you would earn a total of 119.00 from holding Hotel Property Investments or generate 47.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nine Entertainment Co vs. Hotel Property Investments
Performance |
| Timeline |
| Nine Entertainment |
| Hotel Property Inves |
Nine Entertainment and Hotel Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nine Entertainment and Hotel Property
The main advantage of trading using opposite Nine Entertainment and Hotel Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nine Entertainment position performs unexpectedly, Hotel Property 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 Hotel Property will offset losses from the drop in Hotel Property's long position.| Nine Entertainment vs. TTG Fintech | Nine Entertainment vs. Thorney Technologies | Nine Entertainment vs. Macquarie Technology Group | Nine Entertainment vs. Flagship Investments |
| Hotel Property vs. Charter Hall Retail | Hotel Property vs. Australian Unity Office | Hotel Property vs. Champion Iron | Hotel Property vs. Ridley |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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