Correlation Between Nueva Expresin and Melia Hotels
Can any of the company-specific risk be diversified away by investing in both Nueva Expresin and Melia Hotels 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 Nueva Expresin and Melia Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nueva Expresin Textil and Melia Hotels, you can compare the effects of market volatilities on Nueva Expresin and Melia Hotels 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 Nueva Expresin with a short position of Melia Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nueva Expresin and Melia Hotels.
Diversification Opportunities for Nueva Expresin and Melia Hotels
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Nueva and Melia is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Nueva Expresin Textil and Melia Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Melia Hotels and Nueva Expresin 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 Nueva Expresin Textil are associated (or correlated) with Melia Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Melia Hotels has no effect on the direction of Nueva Expresin i.e., Nueva Expresin and Melia Hotels go up and down completely randomly.
Pair Corralation between Nueva Expresin and Melia Hotels
Assuming the 90 days trading horizon Nueva Expresin Textil is expected to under-perform the Melia Hotels. In addition to that, Nueva Expresin is 1.54 times more volatile than Melia Hotels. It trades about -0.02 of its total potential returns per unit of risk. Melia Hotels is currently generating about 0.04 per unit of volatility. If you would invest 498.00 in Melia Hotels on September 3, 2024 and sell it today you would earn a total of 179.00 from holding Melia Hotels or generate 35.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nueva Expresin Textil vs. Melia Hotels
Performance |
| Timeline |
| Nueva Expresin Textil |
| Melia Hotels |
Nueva Expresin and Melia Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nueva Expresin and Melia Hotels
The main advantage of trading using opposite Nueva Expresin and Melia Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nueva Expresin position performs unexpectedly, Melia Hotels 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 Melia Hotels will offset losses from the drop in Melia Hotels' long position.| Nueva Expresin vs. Melia Hotels | Nueva Expresin vs. International Consolidated Airlines | Nueva Expresin vs. Atresmedia Corporacin de | Nueva Expresin vs. Borges Agricultural Industrial |
| Melia Hotels vs. Aedas Homes SL | Melia Hotels vs. Metrovacesa SA | Melia Hotels vs. Merlin Properties SOCIMI | Melia Hotels vs. Lar Espana Real |
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.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |