Correlation Between Xenia Hotels and CEOTRONICS

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Xenia Hotels and CEOTRONICS 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 Xenia Hotels and CEOTRONICS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xenia Hotels Resorts and CEOTRONICS, you can compare the effects of market volatilities on Xenia Hotels and CEOTRONICS 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 Xenia Hotels with a short position of CEOTRONICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xenia Hotels and CEOTRONICS.

Diversification Opportunities for Xenia Hotels and CEOTRONICS

0.5
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Xenia and CEOTRONICS is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Xenia Hotels Resorts and CEOTRONICS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CEOTRONICS and Xenia 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 Xenia Hotels Resorts are associated (or correlated) with CEOTRONICS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CEOTRONICS has no effect on the direction of Xenia Hotels i.e., Xenia Hotels and CEOTRONICS go up and down completely randomly.

Pair Corralation between Xenia Hotels and CEOTRONICS

Assuming the 90 days trading horizon Xenia Hotels is expected to generate 2.32 times less return on investment than CEOTRONICS. But when comparing it to its historical volatility, Xenia Hotels Resorts is 1.44 times less risky than CEOTRONICS. It trades about 0.11 of its potential returns per unit of risk. CEOTRONICS is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  501.00  in CEOTRONICS on September 4, 2024 and sell it today you would earn a total of  204.00  from holding CEOTRONICS or generate 40.72% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy98.46%
ValuesDaily Returns

Xenia Hotels Resorts  vs.  CEOTRONICS

 Performance 
       Timeline  
Xenia Hotels Resorts 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Xenia Hotels Resorts are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical indicators, Xenia Hotels reported solid returns over the last few months and may actually be approaching a breakup point.
CEOTRONICS 

Risk-Adjusted Performance

14 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in CEOTRONICS are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, CEOTRONICS unveiled solid returns over the last few months and may actually be approaching a breakup point.

Xenia Hotels and CEOTRONICS Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Xenia Hotels and CEOTRONICS

The main advantage of trading using opposite Xenia Hotels and CEOTRONICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xenia Hotels position performs unexpectedly, CEOTRONICS 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 CEOTRONICS will offset losses from the drop in CEOTRONICS's long position.
The idea behind Xenia Hotels Resorts and CEOTRONICS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.

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
Funds Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
Equity Forecasting
Use basic forecasting models to generate price predictions and determine price momentum
Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device