Correlation Between MIRAMAR HOTEL and KWESST MICRO

Can any of the company-specific risk be diversified away by investing in both MIRAMAR HOTEL and KWESST MICRO 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 MIRAMAR HOTEL and KWESST MICRO into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MIRAMAR HOTEL INV and KWESST MICRO SYSINC, you can compare the effects of market volatilities on MIRAMAR HOTEL and KWESST MICRO 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 MIRAMAR HOTEL with a short position of KWESST MICRO. Check out your portfolio center. Please also check ongoing floating volatility patterns of MIRAMAR HOTEL and KWESST MICRO.

Diversification Opportunities for MIRAMAR HOTEL and KWESST MICRO

0.0

Correlation Coefficient

MIRAMAR HOTEL  KWESST MICRO

Pay attention - limited upside

The 3 months correlation between MIRAMAR and KWESST is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding MIRAMAR HOTEL INV and KWESST MICRO SYSINC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KWESST MICRO SYSINC and MIRAMAR HOTEL 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 MIRAMAR HOTEL INV are associated (or correlated) with KWESST MICRO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KWESST MICRO SYSINC has no effect on the direction of MIRAMAR HOTEL i.e., MIRAMAR HOTEL and KWESST MICRO go up and down completely randomly.

Pair Corralation between MIRAMAR HOTEL and KWESST MICRO

Assuming the 90 days trading horizon MIRAMAR HOTEL INV is expected to generate 0.11 times more return on investment than KWESST MICRO. However, MIRAMAR HOTEL INV is 8.8 times less risky than KWESST MICRO. It trades about 0.15 of its potential returns per unit of risk. KWESST MICRO SYSINC is currently generating about -0.05 per unit of risk. If you would invest  112.00  in MIRAMAR HOTEL INV on September 30, 2024 and sell it today you would earn a total of  2.00  from holding MIRAMAR HOTEL INV or generate 1.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	94.74%
Values	Daily Returns

MIRAMAR HOTEL INV  vs.  KWESST MICRO SYSINC

MIRAMAR HOTEL INV

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in MIRAMAR HOTEL INV are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound essential indicators, MIRAMAR HOTEL is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

KWESST MICRO SYSINC

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in KWESST MICRO SYSINC are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, KWESST MICRO reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with MIRAMAR HOTEL and KWESST MICRO

The main advantage of trading using opposite MIRAMAR HOTEL and KWESST MICRO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MIRAMAR HOTEL position performs unexpectedly, KWESST MICRO 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 KWESST MICRO will offset losses from the drop in KWESST MICRO's long position.

The idea behind MIRAMAR HOTEL INV and KWESST MICRO SYSINC 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.