Correlation Between LuxUrban Hotels and Mamas Creations

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both LuxUrban Hotels and Mamas Creations 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 LuxUrban Hotels and Mamas Creations into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LuxUrban Hotels 1300 and Mamas Creations, you can compare the effects of market volatilities on LuxUrban Hotels and Mamas Creations 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 LuxUrban Hotels with a short position of Mamas Creations. Check out your portfolio center. Please also check ongoing floating volatility patterns of LuxUrban Hotels and Mamas Creations.

Diversification Opportunities for LuxUrban Hotels and Mamas Creations

-0.16
  Correlation Coefficient

Good diversification

The 3 months correlation between LuxUrban and Mamas is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding LuxUrban Hotels 1300 and Mamas Creations in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mamas Creations and LuxUrban 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 LuxUrban Hotels 1300 are associated (or correlated) with Mamas Creations. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mamas Creations has no effect on the direction of LuxUrban Hotels i.e., LuxUrban Hotels and Mamas Creations go up and down completely randomly.

Pair Corralation between LuxUrban Hotels and Mamas Creations

Assuming the 90 days horizon LuxUrban Hotels 1300 is expected to under-perform the Mamas Creations. But the preferred stock apears to be less risky and, when comparing its historical volatility, LuxUrban Hotels 1300 is 5.05 times less risky than Mamas Creations. The preferred stock trades about 0.0 of its potential returns per unit of risk. The Mamas Creations is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  193.00  in Mamas Creations on October 10, 2024 and sell it today you would earn a total of  518.00  from holding Mamas Creations or generate 268.39% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy60.12%
ValuesDaily Returns

LuxUrban Hotels 1300  vs.  Mamas Creations

 Performance 
       Timeline  
LuxUrban Hotels 1300 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in LuxUrban Hotels 1300 are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak technical indicators, LuxUrban Hotels reported solid returns over the last few months and may actually be approaching a breakup point.
Mamas Creations 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Mamas Creations has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's primary indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

LuxUrban Hotels and Mamas Creations Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with LuxUrban Hotels and Mamas Creations

The main advantage of trading using opposite LuxUrban Hotels and Mamas Creations positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LuxUrban Hotels position performs unexpectedly, Mamas Creations 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 Mamas Creations will offset losses from the drop in Mamas Creations' long position.
The idea behind LuxUrban Hotels 1300 and Mamas Creations 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.

Other Complementary Tools

Top Crypto Exchanges
Search and analyze digital assets across top global cryptocurrency exchanges
Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Options Analysis
Analyze and evaluate options and option chains as a potential hedge for your portfolios
Money Managers
Screen money managers from public funds and ETFs managed around the world
Investing Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences