Correlation Between Trivago NV and Hello
Can any of the company-specific risk be diversified away by investing in both Trivago NV and Hello 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 Trivago NV and Hello into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trivago NV and Hello Group, you can compare the effects of market volatilities on Trivago NV and Hello 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 Trivago NV with a short position of Hello. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trivago NV and Hello.
Diversification Opportunities for Trivago NV and Hello
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Trivago and Hello is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Trivago NV and Hello Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hello Group and Trivago NV 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 Trivago NV are associated (or correlated) with Hello. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hello Group has no effect on the direction of Trivago NV i.e., Trivago NV and Hello go up and down completely randomly.
Pair Corralation between Trivago NV and Hello
Given the investment horizon of 90 days Trivago NV is expected to generate 1.13 times more return on investment than Hello. However, Trivago NV is 1.13 times more volatile than Hello Group. It trades about 0.16 of its potential returns per unit of risk. Hello Group is currently generating about -0.18 per unit of risk. If you would invest 165.00 in Trivago NV on August 28, 2024 and sell it today you would earn a total of 14.00 from holding Trivago NV or generate 8.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Trivago NV vs. Hello Group
Performance |
| Timeline |
| Trivago NV |
| Hello Group |
Trivago NV and Hello Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trivago NV and Hello
The main advantage of trading using opposite Trivago NV and Hello positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trivago NV position performs unexpectedly, Hello 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 Hello will offset losses from the drop in Hello's long position.| Trivago NV vs. Alphabet Inc Class C | Trivago NV vs. Twilio Inc | Trivago NV vs. Snap Inc | Trivago NV vs. Baidu Inc |
| Hello vs. Weibo Corp | Hello vs. Autohome | Hello vs. Tencent Music Entertainment | Hello vs. DouYu International Holdings |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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