Correlation Between Lemon Tree and COSMO FIRST
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By analyzing existing cross correlation between Lemon Tree Hotels and COSMO FIRST LIMITED, you can compare the effects of market volatilities on Lemon Tree and COSMO FIRST 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 COSMO FIRST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lemon Tree and COSMO FIRST.
Diversification Opportunities for Lemon Tree and COSMO FIRST
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lemon and COSMO is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Lemon Tree Hotels and COSMO FIRST LIMITED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COSMO FIRST LIMITED 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 COSMO FIRST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COSMO FIRST LIMITED has no effect on the direction of Lemon Tree i.e., Lemon Tree and COSMO FIRST go up and down completely randomly.
Pair Corralation between Lemon Tree and COSMO FIRST
Assuming the 90 days trading horizon Lemon Tree is expected to generate 1.28 times less return on investment than COSMO FIRST. But when comparing it to its historical volatility, Lemon Tree Hotels is 1.19 times less risky than COSMO FIRST. It trades about 0.03 of its potential returns per unit of risk. COSMO FIRST LIMITED is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 63,924 in COSMO FIRST LIMITED on August 25, 2024 and sell it today you would earn a total of 10,451 from holding COSMO FIRST LIMITED or generate 16.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.25% |
| Values | Daily Returns |
Lemon Tree Hotels vs. COSMO FIRST LIMITED
Performance |
| Timeline |
| Lemon Tree Hotels |
| COSMO FIRST LIMITED |
Lemon Tree and COSMO FIRST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lemon Tree and COSMO FIRST
The main advantage of trading using opposite Lemon Tree and COSMO FIRST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lemon Tree position performs unexpectedly, COSMO FIRST 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 COSMO FIRST will offset losses from the drop in COSMO FIRST's long position.| Lemon Tree vs. MMTC Limited | Lemon Tree vs. Kingfa Science Technology | Lemon Tree vs. Rico Auto Industries | Lemon Tree vs. GACM Technologies Limited |
| COSMO FIRST vs. ADF Foods Limited | COSMO FIRST vs. Dodla Dairy Limited | COSMO FIRST vs. Datamatics Global Services | COSMO FIRST vs. R S Software |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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