Correlation Between Lemon Tree and Apollo Sindoori
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By analyzing existing cross correlation between Lemon Tree Hotels and Apollo Sindoori Hotels, you can compare the effects of market volatilities on Lemon Tree and Apollo Sindoori 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 Lemon Tree with a short position of Apollo Sindoori. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lemon Tree and Apollo Sindoori.
Diversification Opportunities for Lemon Tree and Apollo Sindoori
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lemon and Apollo is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Lemon Tree Hotels and Apollo Sindoori Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Sindoori Hotels and Lemon Tree 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 Lemon Tree Hotels are associated (or correlated) with Apollo Sindoori. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Sindoori Hotels has no effect on the direction of Lemon Tree i.e., Lemon Tree and Apollo Sindoori go up and down completely randomly.
Pair Corralation between Lemon Tree and Apollo Sindoori
Assuming the 90 days trading horizon Lemon Tree Hotels is expected to generate 0.76 times more return on investment than Apollo Sindoori. However, Lemon Tree Hotels is 1.31 times less risky than Apollo Sindoori. It trades about 0.0 of its potential returns per unit of risk. Apollo Sindoori Hotels is currently generating about -0.05 per unit of risk. If you would invest 13,385 in Lemon Tree Hotels on December 12, 2024 and sell it today you would lose (780.00) from holding Lemon Tree Hotels or give up 5.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lemon Tree Hotels vs. Apollo Sindoori Hotels
Performance |
| Timeline |
| Lemon Tree Hotels |
| Apollo Sindoori Hotels |
Lemon Tree and Apollo Sindoori Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lemon Tree and Apollo Sindoori
The main advantage of trading using opposite Lemon Tree and Apollo Sindoori positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lemon Tree position performs unexpectedly, Apollo Sindoori 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 Apollo Sindoori will offset losses from the drop in Apollo Sindoori's long position.| Lemon Tree vs. Kavveri Telecom Products | ||
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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