Correlation Between Chalet Hotels and Bajaj Holdings
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By analyzing existing cross correlation between Chalet Hotels Limited and Bajaj Holdings Investment, you can compare the effects of market volatilities on Chalet 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 Chalet Hotels with a short position of Bajaj Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chalet Hotels and Bajaj Holdings.
Diversification Opportunities for Chalet Hotels and Bajaj Holdings
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Chalet and Bajaj is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Chalet 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 Chalet 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 Chalet 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 Chalet Hotels i.e., Chalet Hotels and Bajaj Holdings go up and down completely randomly.
Pair Corralation between Chalet Hotels and Bajaj Holdings
Assuming the 90 days trading horizon Chalet Hotels Limited is expected to under-perform the Bajaj Holdings. In addition to that, Chalet Hotels is 1.44 times more volatile than Bajaj Holdings Investment. It trades about -0.08 of its total potential returns per unit of risk. Bajaj Holdings Investment is currently generating about -0.05 per unit of volatility. If you would invest 1,079,100 in Bajaj Holdings Investment on August 25, 2024 and sell it today you would lose (33,270) from holding Bajaj Holdings Investment or give up 3.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.67% |
| Values | Daily Returns |
Chalet Hotels Limited vs. Bajaj Holdings Investment
Performance |
| Timeline |
| Chalet Hotels Limited |
| Bajaj Holdings Investment |
Chalet Hotels and Bajaj Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chalet Hotels and Bajaj Holdings
The main advantage of trading using opposite Chalet Hotels and Bajaj Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chalet 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.| Chalet Hotels vs. Mahamaya Steel Industries | Chalet Hotels vs. Sasken Technologies Limited | Chalet Hotels vs. Kalyani Steels Limited | Chalet Hotels vs. Visa Steel Limited |
| Bajaj Holdings vs. Reliance Industries Limited | Bajaj Holdings vs. State Bank of | Bajaj Holdings vs. HDFC Bank Limited | Bajaj Holdings vs. Oil Natural Gas |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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