Correlation Between Booking Holdings and Yatra Online
Can any of the company-specific risk be diversified away by investing in both Booking Holdings and Yatra Online 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 Booking Holdings and Yatra Online into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Booking Holdings and Yatra Online, you can compare the effects of market volatilities on Booking Holdings and Yatra Online 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 Booking Holdings with a short position of Yatra Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of Booking Holdings and Yatra Online.
Diversification Opportunities for Booking Holdings and Yatra Online
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Booking and Yatra is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Booking Holdings and Yatra Online in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yatra Online and Booking Holdings 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 Booking Holdings are associated (or correlated) with Yatra Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yatra Online has no effect on the direction of Booking Holdings i.e., Booking Holdings and Yatra Online go up and down completely randomly.
Pair Corralation between Booking Holdings and Yatra Online
Given the investment horizon of 90 days Booking Holdings is expected to generate 0.75 times more return on investment than Yatra Online. However, Booking Holdings is 1.33 times less risky than Yatra Online. It trades about 0.02 of its potential returns per unit of risk. Yatra Online is currently generating about -0.1 per unit of risk. If you would invest 474,125 in Booking Holdings on November 1, 2024 and sell it today you would earn a total of 3,308 from holding Booking Holdings or generate 0.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Booking Holdings vs. Yatra Online
Performance |
| Timeline |
| Booking Holdings |
| Yatra Online |
Booking Holdings and Yatra Online Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Booking Holdings and Yatra Online
The main advantage of trading using opposite Booking Holdings and Yatra Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Booking Holdings position performs unexpectedly, Yatra Online 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 Yatra Online will offset losses from the drop in Yatra Online's long position.| Booking Holdings vs. TripAdvisor | Booking Holdings vs. Airbnb Inc | Booking Holdings vs. Royal Caribbean Cruises | Booking Holdings vs. Norwegian Cruise Line |
| Yatra Online vs. Despegar Corp | Yatra Online vs. Lindblad Expeditions Holdings | Yatra Online vs. Trip Group Ltd | Yatra Online vs. Travel Leisure Co |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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