Correlation Between NH HOTEL and SEKISUI CHEMICAL
Can any of the company-specific risk be diversified away by investing in both NH HOTEL and SEKISUI CHEMICAL 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 NH HOTEL and SEKISUI CHEMICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NH HOTEL GROUP and SEKISUI CHEMICAL, you can compare the effects of market volatilities on NH HOTEL and SEKISUI CHEMICAL 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 NH HOTEL with a short position of SEKISUI CHEMICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of NH HOTEL and SEKISUI CHEMICAL.
Diversification Opportunities for NH HOTEL and SEKISUI CHEMICAL
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NH5 and SEKISUI is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding NH HOTEL GROUP and SEKISUI CHEMICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEKISUI CHEMICAL and NH HOTEL 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 NH HOTEL GROUP are associated (or correlated) with SEKISUI CHEMICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEKISUI CHEMICAL has no effect on the direction of NH HOTEL i.e., NH HOTEL and SEKISUI CHEMICAL go up and down completely randomly.
Pair Corralation between NH HOTEL and SEKISUI CHEMICAL
Assuming the 90 days trading horizon NH HOTEL GROUP is expected to generate 0.43 times more return on investment than SEKISUI CHEMICAL. However, NH HOTEL GROUP is 2.35 times less risky than SEKISUI CHEMICAL. It trades about -0.11 of its potential returns per unit of risk. SEKISUI CHEMICAL is currently generating about -0.42 per unit of risk. If you would invest 626.00 in NH HOTEL GROUP on October 29, 2024 and sell it today you would lose (7.00) from holding NH HOTEL GROUP or give up 1.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NH HOTEL GROUP vs. SEKISUI CHEMICAL
Performance |
| Timeline |
| NH HOTEL GROUP |
| SEKISUI CHEMICAL |
NH HOTEL and SEKISUI CHEMICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NH HOTEL and SEKISUI CHEMICAL
The main advantage of trading using opposite NH HOTEL and SEKISUI CHEMICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NH HOTEL position performs unexpectedly, SEKISUI CHEMICAL 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 SEKISUI CHEMICAL will offset losses from the drop in SEKISUI CHEMICAL's long position.| NH HOTEL vs. National Retail Properties | NH HOTEL vs. Costco Wholesale Corp | NH HOTEL vs. Retail Estates NV | NH HOTEL vs. FAST RETAIL ADR |
| SEKISUI CHEMICAL vs. Host Hotels Resorts | SEKISUI CHEMICAL vs. Dalata Hotel Group | SEKISUI CHEMICAL vs. Meli Hotels International | SEKISUI CHEMICAL vs. NH HOTEL 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Stocks Directory Find actively traded stocks across global markets |