Correlation Between EIH Associated and Infosys
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By analyzing existing cross correlation between EIH Associated Hotels and Infosys Limited, you can compare the effects of market volatilities on EIH Associated 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 EIH Associated with a short position of Infosys. Check out your portfolio center. Please also check ongoing floating volatility patterns of EIH Associated and Infosys.
Diversification Opportunities for EIH Associated and Infosys
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between EIH and Infosys is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding EIH Associated Hotels and Infosys Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infosys Limited and EIH Associated 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 EIH Associated Hotels 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 EIH Associated i.e., EIH Associated and Infosys go up and down completely randomly.
Pair Corralation between EIH Associated and Infosys
Assuming the 90 days trading horizon EIH Associated Hotels is expected to generate 5.26 times more return on investment than Infosys. However, EIH Associated is 5.26 times more volatile than Infosys Limited. It trades about 0.05 of its potential returns per unit of risk. Infosys Limited is currently generating about 0.05 per unit of risk. If you would invest 20,452 in EIH Associated Hotels on September 26, 2024 and sell it today you would earn a total of 20,578 from holding EIH Associated Hotels or generate 100.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
EIH Associated Hotels vs. Infosys Limited
Performance |
| Timeline |
| EIH Associated Hotels |
| Infosys Limited |
EIH Associated and Infosys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EIH Associated and Infosys
The main advantage of trading using opposite EIH Associated and Infosys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EIH Associated 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.| EIH Associated vs. Kaushalya Infrastructure Development | EIH Associated vs. Tarapur Transformers Limited | EIH Associated vs. Kingfa Science Technology | EIH Associated vs. Rico Auto Industries |
| Infosys vs. Royal Orchid Hotels | Infosys vs. EIH Associated Hotels | Infosys vs. AXISCADES Technologies Limited | Infosys vs. Yatra Online 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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