Correlation Between Asian Hotels and Bajaj Holdings
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By analyzing existing cross correlation between Asian Hotels Limited and Bajaj Holdings Investment, you can compare the effects of market volatilities on Asian Hotels and Bajaj Holdings 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 Asian Hotels with a short position of Bajaj Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asian Hotels and Bajaj Holdings.
Diversification Opportunities for Asian Hotels and Bajaj Holdings
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Asian and Bajaj is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Asian Hotels Limited and Bajaj Holdings Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bajaj Holdings Investment and Asian 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 Asian Hotels Limited are associated (or correlated) with Bajaj Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bajaj Holdings Investment has no effect on the direction of Asian Hotels i.e., Asian Hotels and Bajaj Holdings go up and down completely randomly.
Pair Corralation between Asian Hotels and Bajaj Holdings
Assuming the 90 days trading horizon Asian Hotels Limited is expected to generate 1.83 times more return on investment than Bajaj Holdings. However, Asian Hotels is 1.83 times more volatile than Bajaj Holdings Investment. It trades about 0.07 of its potential returns per unit of risk. Bajaj Holdings Investment is currently generating about 0.07 per unit of risk. If you would invest 8,810 in Asian Hotels Limited on September 4, 2024 and sell it today you would earn a total of 12,194 from holding Asian Hotels Limited or generate 138.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Asian Hotels Limited vs. Bajaj Holdings Investment
Performance |
| Timeline |
| Asian Hotels Limited |
| Bajaj Holdings Investment |
Asian Hotels and Bajaj Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asian Hotels and Bajaj Holdings
The main advantage of trading using opposite Asian Hotels and Bajaj Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asian Hotels position performs unexpectedly, Bajaj Holdings 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 Bajaj Holdings will offset losses from the drop in Bajaj Holdings' long position.| Asian Hotels vs. AAA Technologies Limited | Asian Hotels vs. LLOYDS METALS AND | Asian Hotels vs. Unitech Limited | Asian Hotels vs. Sonata Software Limited |
| Bajaj Holdings vs. MRF Limited | Bajaj Holdings vs. JSW Holdings Limited | Bajaj Holdings vs. Maharashtra Scooters Limited | Bajaj Holdings vs. Nalwa Sons Investments |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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