Correlation Between Quality Houses and Quality Hospitality
Can any of the company-specific risk be diversified away by investing in both Quality Houses and Quality Hospitality 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 Quality Houses and Quality Hospitality into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Quality Houses Property and Quality Hospitality Leasehold, you can compare the effects of market volatilities on Quality Houses and Quality Hospitality 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 Quality Houses with a short position of Quality Hospitality. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quality Houses and Quality Hospitality.
Diversification Opportunities for Quality Houses and Quality Hospitality
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Quality and Quality is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Quality Houses Property and Quality Hospitality Leasehold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quality Hospitality and Quality Houses 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 Quality Houses Property are associated (or correlated) with Quality Hospitality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quality Hospitality has no effect on the direction of Quality Houses i.e., Quality Houses and Quality Hospitality go up and down completely randomly.
Pair Corralation between Quality Houses and Quality Hospitality
Assuming the 90 days trading horizon Quality Houses Property is expected to under-perform the Quality Hospitality. But the fund apears to be less risky and, when comparing its historical volatility, Quality Houses Property is 24.36 times less risky than Quality Hospitality. The fund trades about -0.04 of its potential returns per unit of risk. The Quality Hospitality Leasehold is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 260.00 in Quality Hospitality Leasehold on September 14, 2024 and sell it today you would earn a total of 98.00 from holding Quality Hospitality Leasehold or generate 37.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Quality Houses Property vs. Quality Hospitality Leasehold
Performance |
| Timeline |
| Quality Houses Property |
| Quality Hospitality |
Quality Houses and Quality Hospitality Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Quality Houses and Quality Hospitality
The main advantage of trading using opposite Quality Houses and Quality Hospitality positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quality Houses position performs unexpectedly, Quality Hospitality 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 Quality Hospitality will offset losses from the drop in Quality Hospitality's long position.| Quality Houses vs. Quality Houses Hotel | Quality Houses vs. LH Shopping Centers | Quality Houses vs. LH Hotel Leasehold | Quality Houses vs. Future Park Leasehold |
| Quality Hospitality vs. Quality Houses Hotel | Quality Hospitality vs. Quality Houses Property | Quality Hospitality vs. HEMARAJ INDUSTRIAL PROPERTY |
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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |