Correlation Between H World and Accor SA
Can any of the company-specific risk be diversified away by investing in both H World and Accor SA 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 H World and Accor SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between H World Group and Accor SA, you can compare the effects of market volatilities on H World and Accor SA 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 H World with a short position of Accor SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of H World and Accor SA.
Diversification Opportunities for H World and Accor SA
Very good diversification
The 3 months correlation between CL4A and Accor is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding H World Group and Accor SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accor SA and H World 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 H World Group are associated (or correlated) with Accor SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accor SA has no effect on the direction of H World i.e., H World and Accor SA go up and down completely randomly.
Pair Corralation between H World and Accor SA
Assuming the 90 days trading horizon H World is expected to generate 41.56 times less return on investment than Accor SA. In addition to that, H World is 1.85 times more volatile than Accor SA. It trades about 0.0 of its total potential returns per unit of risk. Accor SA is currently generating about 0.1 per unit of volatility. If you would invest 2,274 in Accor SA on September 23, 2024 and sell it today you would earn a total of 2,322 from holding Accor SA or generate 102.11% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
H World Group vs. Accor SA
Performance |
Timeline |
H World Group |
Accor SA |
H World and Accor SA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with H World and Accor SA
The main advantage of trading using opposite H World and Accor SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if H World position performs unexpectedly, Accor SA 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 Accor SA will offset losses from the drop in Accor SA's long position.H World vs. Marriott International | H World vs. Hilton Worldwide Holdings | H World vs. Hyatt Hotels | H World vs. InterContinental Hotels Group |
Accor SA vs. Marriott International | Accor SA vs. Hilton Worldwide Holdings | Accor SA vs. H World Group | Accor SA vs. Hyatt Hotels |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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