Correlation Between Meliá Hotels and CAVA Group,
Can any of the company-specific risk be diversified away by investing in both Meliá Hotels and CAVA Group, 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 Meliá Hotels and CAVA Group, into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Meli Hotels International and CAVA Group,, you can compare the effects of market volatilities on Meliá Hotels and CAVA Group, 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 Meliá Hotels with a short position of CAVA Group,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meliá Hotels and CAVA Group,.
Diversification Opportunities for Meliá Hotels and CAVA Group,
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Meliá and CAVA is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Meli Hotels International and CAVA Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CAVA Group, and Meliá Hotels 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 Meli Hotels International are associated (or correlated) with CAVA Group,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CAVA Group, has no effect on the direction of Meliá Hotels i.e., Meliá Hotels and CAVA Group, go up and down completely randomly.
Pair Corralation between Meliá Hotels and CAVA Group,
If you would invest 13,382 in CAVA Group, on August 31, 2024 and sell it today you would earn a total of 738.00 from holding CAVA Group, or generate 5.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Meli Hotels International vs. CAVA Group,
Performance |
| Timeline |
| Meli Hotels International |
| CAVA Group, |
Meliá Hotels and CAVA Group, Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meliá Hotels and CAVA Group,
The main advantage of trading using opposite Meliá Hotels and CAVA Group, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meliá Hotels position performs unexpectedly, CAVA Group, 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 CAVA Group, will offset losses from the drop in CAVA Group,'s long position.| Meliá Hotels vs. Marriott International | Meliá Hotels vs. Hilton Worldwide Holdings | Meliá Hotels vs. InterContinental Hotels Group | Meliá Hotels vs. InterContinental Hotels Group |
| CAVA Group, vs. RLJ Lodging Trust | CAVA Group, vs. Aquagold International | CAVA Group, vs. Stepstone Group | CAVA Group, vs. Morningstar Unconstrained Allocation |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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