Correlation Between Inhome Prime and NH Hoteles

Can any of the company-specific risk be diversified away by investing in both Inhome Prime and NH Hoteles 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 Inhome Prime and NH Hoteles into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Inhome Prime and NH Hoteles

0.19

Correlation Coefficient

Inhome Prime  NH Hoteles

Average diversification

The 3 months correlation between Inhome and NHH is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Inhome Prime Properties and NH Hoteles in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NH Hoteles and Inhome Prime 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 Inhome Prime Properties are associated (or correlated) with NH Hoteles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NH Hoteles has no effect on the direction of Inhome Prime i.e., Inhome Prime and NH Hoteles go up and down completely randomly.

Pair Corralation between Inhome Prime and NH Hoteles

If you would invest  629.00  in NH Hoteles on December 28, 2024 and sell it today you would earn a total of  1.00  from holding NH Hoteles or generate 0.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Inhome Prime Properties  vs.  NH Hoteles

Inhome Prime Properties

Risk-Adjusted Performance

Very Weak

Over the last 90 days Inhome Prime Properties has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, Inhome Prime is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

NH Hoteles

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in NH Hoteles are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical indicators, NH Hoteles is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Inhome Prime and NH Hoteles

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

The idea behind Inhome Prime Properties and NH Hoteles 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.