Correlation Between Naturhouse Health and NH Hoteles
Can any of the company-specific risk be diversified away by investing in both Naturhouse Health and NH Hoteles 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 Naturhouse Health and NH Hoteles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Naturhouse Health SA and NH Hoteles, you can compare the effects of market volatilities on Naturhouse Health and NH Hoteles 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 Naturhouse Health with a short position of NH Hoteles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Naturhouse Health and NH Hoteles.
Diversification Opportunities for Naturhouse Health and NH Hoteles
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Naturhouse and NHH is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Naturhouse Health SA and NH Hoteles in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NH Hoteles and Naturhouse Health 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 Naturhouse Health SA are associated (or correlated) with NH Hoteles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NH Hoteles has no effect on the direction of Naturhouse Health i.e., Naturhouse Health and NH Hoteles go up and down completely randomly.
Pair Corralation between Naturhouse Health and NH Hoteles
Assuming the 90 days trading horizon Naturhouse Health is expected to generate 1.82 times less return on investment than NH Hoteles. But when comparing it to its historical volatility, Naturhouse Health SA is 1.2 times less risky than NH Hoteles. It trades about 0.03 of its potential returns per unit of risk. NH Hoteles is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 430.00 in NH Hoteles on August 31, 2024 and sell it today you would earn a total of 5.00 from holding NH Hoteles or generate 1.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Naturhouse Health SA vs. NH Hoteles
Performance |
| Timeline |
| Naturhouse Health |
| NH Hoteles |
Naturhouse Health and NH Hoteles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Naturhouse Health and NH Hoteles
The main advantage of trading using opposite Naturhouse Health and NH Hoteles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Naturhouse Health position performs unexpectedly, NH Hoteles 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 NH Hoteles will offset losses from the drop in NH Hoteles' long position.| Naturhouse Health vs. Caixabank SA | Naturhouse Health vs. Azaria Rental SOCIMI | Naturhouse Health vs. Labiana Health SA | Naturhouse Health vs. Inhome Prime Properties |
| NH Hoteles vs. International Consolidated Airlines | NH Hoteles vs. Merlin Properties SOCIMI | NH Hoteles vs. Aena SA | 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |