Correlation Between Kaushalya Infrastructure and EIH Associated
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By analyzing existing cross correlation between Kaushalya Infrastructure Development and EIH Associated Hotels, you can compare the effects of market volatilities on Kaushalya Infrastructure and EIH Associated 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 Kaushalya Infrastructure with a short position of EIH Associated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaushalya Infrastructure and EIH Associated.
Diversification Opportunities for Kaushalya Infrastructure and EIH Associated
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kaushalya and EIH is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Kaushalya Infrastructure Devel and EIH Associated Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EIH Associated Hotels and Kaushalya Infrastructure 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 Kaushalya Infrastructure Development are associated (or correlated) with EIH Associated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EIH Associated Hotels has no effect on the direction of Kaushalya Infrastructure i.e., Kaushalya Infrastructure and EIH Associated go up and down completely randomly.
Pair Corralation between Kaushalya Infrastructure and EIH Associated
Assuming the 90 days trading horizon Kaushalya Infrastructure Development is expected to generate 1.85 times more return on investment than EIH Associated. However, Kaushalya Infrastructure is 1.85 times more volatile than EIH Associated Hotels. It trades about 0.08 of its potential returns per unit of risk. EIH Associated Hotels is currently generating about -0.06 per unit of risk. If you would invest 96,170 in Kaushalya Infrastructure Development on October 13, 2024 and sell it today you would earn a total of 6,865 from holding Kaushalya Infrastructure Development or generate 7.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kaushalya Infrastructure Devel vs. EIH Associated Hotels
Performance |
| Timeline |
| Kaushalya Infrastructure |
| EIH Associated Hotels |
Kaushalya Infrastructure and EIH Associated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kaushalya Infrastructure and EIH Associated
The main advantage of trading using opposite Kaushalya Infrastructure and EIH Associated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaushalya Infrastructure position performs unexpectedly, EIH Associated 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 EIH Associated will offset losses from the drop in EIH Associated's long position.The idea behind Kaushalya Infrastructure Development and EIH Associated Hotels pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Global Correlations module to find global opportunities by holding instruments from different markets.
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