Correlation Between AMADEUS IT and Infosys
Can any of the company-specific risk be diversified away by investing in both AMADEUS IT and Infosys 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 AMADEUS IT and Infosys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMADEUS IT GRP and Infosys Limited, you can compare the effects of market volatilities on AMADEUS IT and Infosys 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 AMADEUS IT with a short position of Infosys. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMADEUS IT and Infosys.
Diversification Opportunities for AMADEUS IT and Infosys
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AMADEUS and Infosys is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding AMADEUS IT GRP and Infosys Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infosys Limited and AMADEUS IT 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 AMADEUS IT GRP are associated (or correlated) with Infosys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infosys Limited has no effect on the direction of AMADEUS IT i.e., AMADEUS IT and Infosys go up and down completely randomly.
Pair Corralation between AMADEUS IT and Infosys
Assuming the 90 days trading horizon AMADEUS IT GRP is expected to generate 0.99 times more return on investment than Infosys. However, AMADEUS IT GRP is 1.01 times less risky than Infosys. It trades about -0.03 of its potential returns per unit of risk. Infosys Limited is currently generating about -0.38 per unit of risk. If you would invest 7,050 in AMADEUS IT GRP on December 13, 2024 and sell it today you would lose (150.00) from holding AMADEUS IT GRP or give up 2.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMADEUS IT GRP vs. Infosys Limited
Performance |
| Timeline |
| AMADEUS IT GRP |
| Infosys Limited |
AMADEUS IT and Infosys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMADEUS IT and Infosys
The main advantage of trading using opposite AMADEUS IT and Infosys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMADEUS IT position performs unexpectedly, Infosys 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 Infosys will offset losses from the drop in Infosys' long position.| AMADEUS IT vs. Perseus Mining Limited | AMADEUS IT vs. GALENA MINING LTD | AMADEUS IT vs. GREENX METALS LTD | AMADEUS IT vs. ARDAGH METAL PACDL 0001 |
| Infosys vs. Transport International Holdings | Infosys vs. China Datang | Infosys vs. Datang International Power | Infosys vs. Canadian Utilities Limited |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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