Correlation Between NH Hoteles and Inmobiliaria Del
Can any of the company-specific risk be diversified away by investing in both NH Hoteles and Inmobiliaria Del 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 Inmobiliaria Del into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NH Hoteles and Inmobiliaria del Sur, you can compare the effects of market volatilities on NH Hoteles and Inmobiliaria Del 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 Inmobiliaria Del. Check out your portfolio center. Please also check ongoing floating volatility patterns of NH Hoteles and Inmobiliaria Del.
Diversification Opportunities for NH Hoteles and Inmobiliaria Del
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NHH and Inmobiliaria is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding NH Hoteles and Inmobiliaria del Sur in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inmobiliaria del Sur 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 Inmobiliaria Del. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inmobiliaria del Sur has no effect on the direction of NH Hoteles i.e., NH Hoteles and Inmobiliaria Del go up and down completely randomly.
Pair Corralation between NH Hoteles and Inmobiliaria Del
Assuming the 90 days trading horizon NH Hoteles is expected to generate 0.94 times more return on investment than Inmobiliaria Del. However, NH Hoteles is 1.06 times less risky than Inmobiliaria Del. It trades about 0.06 of its potential returns per unit of risk. Inmobiliaria del Sur is currently generating about 0.04 per unit of risk. If you would invest 359.00 in NH Hoteles on October 13, 2024 and sell it today you would earn a total of 269.00 from holding NH Hoteles or generate 74.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 93.45% |
| Values | Daily Returns |
NH Hoteles vs. Inmobiliaria del Sur
Performance |
| Timeline |
| NH Hoteles |
| Inmobiliaria del Sur |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
NH Hoteles and Inmobiliaria Del Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NH Hoteles and Inmobiliaria Del
The main advantage of trading using opposite NH Hoteles and Inmobiliaria Del positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NH Hoteles position performs unexpectedly, Inmobiliaria Del 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 Inmobiliaria Del will offset losses from the drop in Inmobiliaria Del's long position.| NH Hoteles vs. Melia Hotels | NH Hoteles vs. Indra A | NH Hoteles vs. Fomento de Construcciones | NH Hoteles vs. Acerinox |
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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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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