Correlation Between EIH Associated and ITI
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By analyzing existing cross correlation between EIH Associated Hotels and ITI Limited, you can compare the effects of market volatilities on EIH Associated and ITI 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 ITI. Check out your portfolio center. Please also check ongoing floating volatility patterns of EIH Associated and ITI.
Diversification Opportunities for EIH Associated and ITI
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between EIH and ITI is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding EIH Associated Hotels and ITI Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ITI 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 ITI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ITI Limited has no effect on the direction of EIH Associated i.e., EIH Associated and ITI go up and down completely randomly.
Pair Corralation between EIH Associated and ITI
Assuming the 90 days trading horizon EIH Associated Hotels is expected to under-perform the ITI. But the stock apears to be less risky and, when comparing its historical volatility, EIH Associated Hotels is 2.48 times less risky than ITI. The stock trades about -0.02 of its potential returns per unit of risk. The ITI Limited is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 36,125 in ITI Limited on October 12, 2024 and sell it today you would earn a total of 7,915 from holding ITI Limited or generate 21.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EIH Associated Hotels vs. ITI Limited
Performance |
| Timeline |
| EIH Associated Hotels |
| ITI Limited |
EIH Associated and ITI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EIH Associated and ITI
The main advantage of trading using opposite EIH Associated and ITI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EIH Associated position performs unexpectedly, ITI 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 ITI will offset losses from the drop in ITI's long position.| EIH Associated vs. 63 moons technologies | EIH Associated vs. UltraTech Cement Limited | EIH Associated vs. California Software | EIH Associated vs. Selan Exploration Technology |
| ITI vs. Blue Coast Hotels | ITI vs. SINCLAIRS HOTELS ORD | ITI vs. EIH Associated Hotels | ITI vs. Viceroy Hotels 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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