Correlation Between Ryman Hospitality and Mingteng International

Can any of the company-specific risk be diversified away by investing in both Ryman Hospitality and Mingteng International 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 Ryman Hospitality and Mingteng International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ryman Hospitality Properties and Mingteng International, you can compare the effects of market volatilities on Ryman Hospitality and Mingteng International 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 Ryman Hospitality with a short position of Mingteng International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ryman Hospitality and Mingteng International.

Diversification Opportunities for Ryman Hospitality and Mingteng International

0.32

Correlation Coefficient

Ryman Hospitality  Mingteng International

Weak diversification

The 3 months correlation between Ryman and Mingteng is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Ryman Hospitality Properties and Mingteng International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mingteng International and Ryman Hospitality 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 Ryman Hospitality Properties are associated (or correlated) with Mingteng International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mingteng International has no effect on the direction of Ryman Hospitality i.e., Ryman Hospitality and Mingteng International go up and down completely randomly.

Pair Corralation between Ryman Hospitality and Mingteng International

Considering the 90-day investment horizon Ryman Hospitality is expected to generate 3.4 times less return on investment than Mingteng International. But when comparing it to its historical volatility, Ryman Hospitality Properties is 6.9 times less risky than Mingteng International. It trades about 0.2 of its potential returns per unit of risk. Mingteng International is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  422.00  in Mingteng International on September 4, 2024 and sell it today you would earn a total of  174.00  from holding Mingteng International or generate 41.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Ryman Hospitality Properties  vs.  Mingteng International

Ryman Hospitality

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ryman Hospitality Properties are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Even with relatively sluggish technical indicators, Ryman Hospitality reported solid returns over the last few months and may actually be approaching a breakup point.

Mingteng International

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Mingteng International are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting technical and fundamental indicators, Mingteng International displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ryman Hospitality and Mingteng International

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

The idea behind Ryman Hospitality Properties and Mingteng International 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.

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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.