Correlation Between Meliá Hotels and Boyd Gaming
Can any of the company-specific risk be diversified away by investing in both Meliá Hotels and Boyd Gaming 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 Meliá Hotels and Boyd Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Meli Hotels International and Boyd Gaming, you can compare the effects of market volatilities on Meliá Hotels and Boyd Gaming 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 Meliá Hotels with a short position of Boyd Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meliá Hotels and Boyd Gaming.
Diversification Opportunities for Meliá Hotels and Boyd Gaming
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Meliá and Boyd is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Meli Hotels International and Boyd Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boyd Gaming and Meliá 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 Meli Hotels International are associated (or correlated) with Boyd Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boyd Gaming has no effect on the direction of Meliá Hotels i.e., Meliá Hotels and Boyd Gaming go up and down completely randomly.
Pair Corralation between Meliá Hotels and Boyd Gaming
Assuming the 90 days horizon Meli Hotels International is expected to under-perform the Boyd Gaming. In addition to that, Meliá Hotels is 1.18 times more volatile than Boyd Gaming. It trades about -0.06 of its total potential returns per unit of risk. Boyd Gaming is currently generating about -0.05 per unit of volatility. If you would invest 7,196 in Boyd Gaming on December 26, 2024 and sell it today you would lose (366.00) from holding Boyd Gaming or give up 5.09% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Meli Hotels International vs. Boyd Gaming
Performance |
Timeline |
Meli Hotels International |
Boyd Gaming |
Meliá Hotels and Boyd Gaming Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Meliá Hotels and Boyd Gaming
The main advantage of trading using opposite Meliá Hotels and Boyd Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meliá Hotels position performs unexpectedly, Boyd Gaming 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 Boyd Gaming will offset losses from the drop in Boyd Gaming's long position.Meliá Hotels vs. Discover Financial Services | Meliá Hotels vs. Juniata Valley Financial | Meliá Hotels vs. Nasdaq Inc | Meliá Hotels vs. Dalata Hotel Group |
Boyd Gaming vs. MGM Resorts International | Boyd Gaming vs. Las Vegas Sands | Boyd Gaming vs. Wynn Resorts Limited | Boyd Gaming vs. Penn National Gaming |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |