Correlation Between GTL and KIOCL
Can any of the company-specific risk be diversified away by investing in both GTL and KIOCL 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 GTL and KIOCL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GTL Limited and KIOCL Limited, you can compare the effects of market volatilities on GTL and KIOCL 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 GTL with a short position of KIOCL. Check out your portfolio center. Please also check ongoing floating volatility patterns of GTL and KIOCL.
Diversification Opportunities for GTL and KIOCL
Very weak diversification
The 3 months correlation between GTL and KIOCL is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding GTL Limited and KIOCL Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KIOCL Limited and GTL 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 GTL Limited are associated (or correlated) with KIOCL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KIOCL Limited has no effect on the direction of GTL i.e., GTL and KIOCL go up and down completely randomly.
Pair Corralation between GTL and KIOCL
Assuming the 90 days trading horizon GTL Limited is expected to generate 1.28 times more return on investment than KIOCL. However, GTL is 1.28 times more volatile than KIOCL Limited. It trades about 0.07 of its potential returns per unit of risk. KIOCL Limited is currently generating about 0.03 per unit of risk. If you would invest 760.00 in GTL Limited on September 2, 2024 and sell it today you would earn a total of 527.00 from holding GTL Limited or generate 69.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GTL Limited vs. KIOCL Limited
Performance |
| Timeline |
| GTL Limited |
| KIOCL Limited |
GTL and KIOCL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GTL and KIOCL
The main advantage of trading using opposite GTL and KIOCL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GTL position performs unexpectedly, KIOCL 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 KIOCL will offset losses from the drop in KIOCL's long position.| GTL vs. One 97 Communications | GTL vs. Paramount Communications Limited | GTL vs. OnMobile Global Limited | GTL vs. Elin Electronics Limited |
| KIOCL vs. Akme Fintrade India | KIOCL vs. Palred Technologies Limited | KIOCL vs. Osia Hyper Retail | KIOCL vs. V2 Retail 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |