Correlation Between Clean Energy and Meli Hotels
Can any of the company-specific risk be diversified away by investing in both Clean Energy and Meli Hotels 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 Clean Energy and Meli Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clean Energy Fuels and Meli Hotels International, you can compare the effects of market volatilities on Clean Energy and Meli Hotels 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 Clean Energy with a short position of Meli Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clean Energy and Meli Hotels.
Diversification Opportunities for Clean Energy and Meli Hotels
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Clean and Meli is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Clean Energy Fuels and Meli Hotels International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meli Hotels International and Clean Energy 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 Clean Energy Fuels are associated (or correlated) with Meli Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meli Hotels International has no effect on the direction of Clean Energy i.e., Clean Energy and Meli Hotels go up and down completely randomly.
Pair Corralation between Clean Energy and Meli Hotels
Assuming the 90 days horizon Clean Energy Fuels is expected to under-perform the Meli Hotels. In addition to that, Clean Energy is 2.88 times more volatile than Meli Hotels International. It trades about -0.05 of its total potential returns per unit of risk. Meli Hotels International is currently generating about 0.09 per unit of volatility. If you would invest 669.00 in Meli Hotels International on August 28, 2024 and sell it today you would earn a total of 19.00 from holding Meli Hotels International or generate 2.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clean Energy Fuels vs. Meli Hotels International
Performance |
| Timeline |
| Clean Energy Fuels |
| Meli Hotels International |
Clean Energy and Meli Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clean Energy and Meli Hotels
The main advantage of trading using opposite Clean Energy and Meli Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clean Energy position performs unexpectedly, Meli Hotels 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 Meli Hotels will offset losses from the drop in Meli Hotels' long position.| Clean Energy vs. Superior Plus Corp | Clean Energy vs. NMI Holdings | Clean Energy vs. Origin Agritech | Clean Energy vs. SIVERS SEMICONDUCTORS AB |
| Meli Hotels vs. Clean Energy Fuels | Meli Hotels vs. GREENX METALS LTD | Meli Hotels vs. GRIFFIN MINING LTD | Meli Hotels vs. Infrastrutture Wireless Italiane |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |