Correlation Between Indian Hotels and GM Breweries
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By analyzing existing cross correlation between The Indian Hotels and GM Breweries Limited, you can compare the effects of market volatilities on Indian Hotels and GM Breweries 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 Indian Hotels with a short position of GM Breweries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indian Hotels and GM Breweries.
Diversification Opportunities for Indian Hotels and GM Breweries
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Indian and GMBREW is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding The Indian Hotels and GM Breweries Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GM Breweries Limited and Indian 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 The Indian Hotels are associated (or correlated) with GM Breweries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GM Breweries Limited has no effect on the direction of Indian Hotels i.e., Indian Hotels and GM Breweries go up and down completely randomly.
Pair Corralation between Indian Hotels and GM Breweries
Assuming the 90 days trading horizon The Indian Hotels is expected to generate 0.92 times more return on investment than GM Breweries. However, The Indian Hotels is 1.09 times less risky than GM Breweries. It trades about -0.23 of its potential returns per unit of risk. GM Breweries Limited is currently generating about -0.27 per unit of risk. If you would invest 87,245 in The Indian Hotels on November 4, 2024 and sell it today you would lose (10,775) from holding The Indian Hotels or give up 12.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Indian Hotels vs. GM Breweries Limited
Performance |
| Timeline |
| Indian Hotels |
| GM Breweries Limited |
Indian Hotels and GM Breweries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indian Hotels and GM Breweries
The main advantage of trading using opposite Indian Hotels and GM Breweries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indian Hotels position performs unexpectedly, GM Breweries 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 GM Breweries will offset losses from the drop in GM Breweries' long position.| Indian Hotels vs. Consolidated Construction Consortium | Indian Hotels vs. Biofil Chemicals Pharmaceuticals | Indian Hotels vs. Refex Industries Limited | Indian Hotels vs. Kingfa Science Technology |
| GM Breweries vs. Total Transport Systems | GM Breweries vs. Cholamandalam Investment and | GM Breweries vs. BF Investment Limited | GM Breweries vs. Mask Investments 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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