Correlation Between TUI AG and Airbnb
Can any of the company-specific risk be diversified away by investing in both TUI AG and Airbnb 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 TUI AG and Airbnb into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TUI AG and Airbnb Inc, you can compare the effects of market volatilities on TUI AG and Airbnb 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 TUI AG with a short position of Airbnb. Check out your portfolio center. Please also check ongoing floating volatility patterns of TUI AG and Airbnb.
Diversification Opportunities for TUI AG and Airbnb
Poor diversification
The 3 months correlation between TUI and Airbnb is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding TUI AG and Airbnb Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airbnb Inc and TUI AG 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 TUI AG are associated (or correlated) with Airbnb. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airbnb Inc has no effect on the direction of TUI AG i.e., TUI AG and Airbnb go up and down completely randomly.
Pair Corralation between TUI AG and Airbnb
Assuming the 90 days horizon TUI AG is expected to under-perform the Airbnb. But the pink sheet apears to be less risky and, when comparing its historical volatility, TUI AG is 1.03 times less risky than Airbnb. The pink sheet trades about -0.05 of its potential returns per unit of risk. The Airbnb Inc is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 13,650 in Airbnb Inc on August 31, 2024 and sell it today you would earn a total of 178.00 from holding Airbnb Inc or generate 1.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TUI AG vs. Airbnb Inc
Performance |
| Timeline |
| TUI AG |
| Airbnb Inc |
TUI AG and Airbnb Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TUI AG and Airbnb
The main advantage of trading using opposite TUI AG and Airbnb positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TUI AG position performs unexpectedly, Airbnb 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 Airbnb will offset losses from the drop in Airbnb's long position.| TUI AG vs. Expedia Group | TUI AG vs. Trip Group Ltd | TUI AG vs. Booking Holdings | TUI AG vs. Despegar Corp |
| Airbnb vs. Norwegian Cruise Line | Airbnb vs. Royal Caribbean Cruises | Airbnb vs. Expedia Group | Airbnb vs. Booking 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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