Correlation Between NH Hoteles and Bankinter
Can any of the company-specific risk be diversified away by investing in both NH Hoteles and Bankinter 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 Hoteles and Bankinter into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NH Hoteles and Bankinter, you can compare the effects of market volatilities on NH Hoteles and Bankinter 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 Hoteles with a short position of Bankinter. Check out your portfolio center. Please also check ongoing floating volatility patterns of NH Hoteles and Bankinter.
Diversification Opportunities for NH Hoteles and Bankinter
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NHH and Bankinter is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding NH Hoteles and Bankinter in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bankinter and NH Hoteles 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 Hoteles are associated (or correlated) with Bankinter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bankinter has no effect on the direction of NH Hoteles i.e., NH Hoteles and Bankinter go up and down completely randomly.
Pair Corralation between NH Hoteles and Bankinter
Assuming the 90 days trading horizon NH Hoteles is expected to generate 1.39 times less return on investment than Bankinter. But when comparing it to its historical volatility, NH Hoteles is 1.03 times less risky than Bankinter. It trades about 0.03 of its potential returns per unit of risk. Bankinter is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 590.00 in Bankinter on August 27, 2024 and sell it today you would earn a total of 163.00 from holding Bankinter or generate 27.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NH Hoteles vs. Bankinter
Performance |
| Timeline |
| NH Hoteles |
| Bankinter |
NH Hoteles and Bankinter Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NH Hoteles and Bankinter
The main advantage of trading using opposite NH Hoteles and Bankinter positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NH Hoteles position performs unexpectedly, Bankinter 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 Bankinter will offset losses from the drop in Bankinter's long position.| NH Hoteles vs. Melia Hotels | NH Hoteles vs. Indra A | NH Hoteles vs. Fomento de Construcciones | NH Hoteles vs. Acerinox |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |