Correlation Between NH Hoteles and Azaria Rental
Can any of the company-specific risk be diversified away by investing in both NH Hoteles and Azaria Rental 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 Azaria Rental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NH Hoteles and Azaria Rental SOCIMI, you can compare the effects of market volatilities on NH Hoteles and Azaria Rental 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 Azaria Rental. Check out your portfolio center. Please also check ongoing floating volatility patterns of NH Hoteles and Azaria Rental.
Diversification Opportunities for NH Hoteles and Azaria Rental
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between NHH and Azaria is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding NH Hoteles and Azaria Rental SOCIMI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Azaria Rental SOCIMI 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 Azaria Rental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Azaria Rental SOCIMI has no effect on the direction of NH Hoteles i.e., NH Hoteles and Azaria Rental go up and down completely randomly.
Pair Corralation between NH Hoteles and Azaria Rental
Assuming the 90 days trading horizon NH Hoteles is expected to generate 2.8 times more return on investment than Azaria Rental. However, NH Hoteles is 2.8 times more volatile than Azaria Rental SOCIMI. It trades about 0.03 of its potential returns per unit of risk. Azaria Rental SOCIMI is currently generating about -0.15 per unit of risk. If you would invest 420.00 in NH Hoteles on August 27, 2024 and sell it today you would earn a total of 7.00 from holding NH Hoteles or generate 1.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NH Hoteles vs. Azaria Rental SOCIMI
Performance |
| Timeline |
| NH Hoteles |
| Azaria Rental SOCIMI |
NH Hoteles and Azaria Rental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NH Hoteles and Azaria Rental
The main advantage of trading using opposite NH Hoteles and Azaria Rental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NH Hoteles position performs unexpectedly, Azaria Rental 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 Azaria Rental will offset losses from the drop in Azaria Rental's long position.| NH Hoteles vs. Melia Hotels | NH Hoteles vs. Indra A | NH Hoteles vs. Fomento de Construcciones | NH Hoteles vs. Acerinox |
| Azaria Rental vs. Arrienda Rental Properties | Azaria Rental vs. Home Capital Rentals | Azaria Rental vs. Cox ABG Group | Azaria Rental vs. Tier1 Technology SA |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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