Correlation Between QBE Insurance and MHP Hotel
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By analyzing existing cross correlation between QBE Insurance Group and MHP Hotel AG, you can compare the effects of market volatilities on QBE Insurance and MHP Hotel 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 QBE Insurance with a short position of MHP Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of QBE Insurance and MHP Hotel.
Diversification Opportunities for QBE Insurance and MHP Hotel
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between QBE and MHP is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding QBE Insurance Group and MHP Hotel AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MHP Hotel AG and QBE Insurance 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 QBE Insurance Group are associated (or correlated) with MHP Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MHP Hotel AG has no effect on the direction of QBE Insurance i.e., QBE Insurance and MHP Hotel go up and down completely randomly.
Pair Corralation between QBE Insurance and MHP Hotel
Assuming the 90 days horizon QBE Insurance Group is expected to generate 0.42 times more return on investment than MHP Hotel. However, QBE Insurance Group is 2.37 times less risky than MHP Hotel. It trades about 0.5 of its potential returns per unit of risk. MHP Hotel AG is currently generating about 0.04 per unit of risk. If you would invest 1,030 in QBE Insurance Group on August 31, 2024 and sell it today you would earn a total of 180.00 from holding QBE Insurance Group or generate 17.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
QBE Insurance Group vs. MHP Hotel AG
Performance |
| Timeline |
| QBE Insurance Group |
| MHP Hotel AG |
QBE Insurance and MHP Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with QBE Insurance and MHP Hotel
The main advantage of trading using opposite QBE Insurance and MHP Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if QBE Insurance position performs unexpectedly, MHP Hotel 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 MHP Hotel will offset losses from the drop in MHP Hotel's long position.| QBE Insurance vs. The Progressive | QBE Insurance vs. Fairfax Financial Holdings | QBE Insurance vs. Admiral Group plc | QBE Insurance vs. Insurance Australia Group |
| MHP Hotel vs. LODESTAR MIN | MHP Hotel vs. Impinj Inc | MHP Hotel vs. Impinj Inc | MHP Hotel vs. Superior Plus Corp |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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