Correlation Between EIH Associated and Sportking India
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By analyzing existing cross correlation between EIH Associated Hotels and Sportking India Limited, you can compare the effects of market volatilities on EIH Associated and Sportking India 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 Sportking India. Check out your portfolio center. Please also check ongoing floating volatility patterns of EIH Associated and Sportking India.
Diversification Opportunities for EIH Associated and Sportking India
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between EIH and Sportking is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding EIH Associated Hotels and Sportking India Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sportking India 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 Sportking India. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sportking India has no effect on the direction of EIH Associated i.e., EIH Associated and Sportking India go up and down completely randomly.
Pair Corralation between EIH Associated and Sportking India
Assuming the 90 days trading horizon EIH Associated Hotels is expected to generate 0.63 times more return on investment than Sportking India. However, EIH Associated Hotels is 1.6 times less risky than Sportking India. It trades about 0.19 of its potential returns per unit of risk. Sportking India Limited is currently generating about -0.07 per unit of risk. If you would invest 35,590 in EIH Associated Hotels on August 29, 2024 and sell it today you would earn a total of 2,620 from holding EIH Associated Hotels or generate 7.36% 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. Sportking India Limited
Performance |
| Timeline |
| EIH Associated Hotels |
| Sportking India |
EIH Associated and Sportking India Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EIH Associated and Sportking India
The main advantage of trading using opposite EIH Associated and Sportking India positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EIH Associated position performs unexpectedly, Sportking India 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 Sportking India will offset losses from the drop in Sportking India's long position.| EIH Associated vs. Nalwa Sons Investments | EIH Associated vs. The State Trading | EIH Associated vs. Mangalam Drugs And | EIH Associated vs. Bombay Burmah Trading |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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