Correlation Between Lemon Tree and Emkay Global
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By analyzing existing cross correlation between Lemon Tree Hotels and Emkay Global Financial, you can compare the effects of market volatilities on Lemon Tree and Emkay Global 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 Emkay Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lemon Tree and Emkay Global.
Diversification Opportunities for Lemon Tree and Emkay Global
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Lemon and Emkay is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Lemon Tree Hotels and Emkay Global Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emkay Global Financial 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 Emkay Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emkay Global Financial has no effect on the direction of Lemon Tree i.e., Lemon Tree and Emkay Global go up and down completely randomly.
Pair Corralation between Lemon Tree and Emkay Global
Assuming the 90 days trading horizon Lemon Tree Hotels is expected to generate 0.92 times more return on investment than Emkay Global. However, Lemon Tree Hotels is 1.08 times less risky than Emkay Global. It trades about -0.16 of its potential returns per unit of risk. Emkay Global Financial is currently generating about -0.35 per unit of risk. If you would invest 15,014 in Lemon Tree Hotels on November 7, 2024 and sell it today you would lose (1,394) from holding Lemon Tree Hotels or give up 9.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lemon Tree Hotels vs. Emkay Global Financial
Performance |
| Timeline |
| Lemon Tree Hotels |
| Emkay Global Financial |
Lemon Tree and Emkay Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lemon Tree and Emkay Global
The main advantage of trading using opposite Lemon Tree and Emkay Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lemon Tree position performs unexpectedly, Emkay Global 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 Emkay Global will offset losses from the drop in Emkay Global's long position.| Lemon Tree vs. Eros International Media | Lemon Tree vs. DIAMINES AND CHEMICALS | Lemon Tree vs. Diligent Media | Lemon Tree vs. Zee Entertainment Enterprises |
| Emkay Global vs. Reliance Industries Limited | Emkay Global vs. Oil Natural Gas | Emkay Global vs. ICICI Bank Limited | Emkay Global vs. Bharti Airtel 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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