Correlation Between Oriental Hotels and Industrial Investment
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By analyzing existing cross correlation between Oriental Hotels Limited and Industrial Investment Trust, you can compare the effects of market volatilities on Oriental Hotels and Industrial Investment 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 Oriental Hotels with a short position of Industrial Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oriental Hotels and Industrial Investment.
Diversification Opportunities for Oriental Hotels and Industrial Investment
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Oriental and Industrial is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Oriental Hotels Limited and Industrial Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrial Investment and Oriental 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 Oriental Hotels Limited are associated (or correlated) with Industrial Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrial Investment has no effect on the direction of Oriental Hotels i.e., Oriental Hotels and Industrial Investment go up and down completely randomly.
Pair Corralation between Oriental Hotels and Industrial Investment
Assuming the 90 days trading horizon Oriental Hotels is expected to generate 1.29 times less return on investment than Industrial Investment. In addition to that, Oriental Hotels is 1.38 times more volatile than Industrial Investment Trust. It trades about 0.19 of its total potential returns per unit of risk. Industrial Investment Trust is currently generating about 0.33 per unit of volatility. If you would invest 32,435 in Industrial Investment Trust on August 28, 2024 and sell it today you would earn a total of 5,610 from holding Industrial Investment Trust or generate 17.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oriental Hotels Limited vs. Industrial Investment Trust
Performance |
| Timeline |
| Oriental Hotels |
| Industrial Investment |
Oriental Hotels and Industrial Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oriental Hotels and Industrial Investment
The main advantage of trading using opposite Oriental Hotels and Industrial Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oriental Hotels position performs unexpectedly, Industrial Investment 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 Industrial Investment will offset losses from the drop in Industrial Investment's long position.| Oriental Hotels vs. Neogen Chemicals Limited | Oriental Hotels vs. DJ Mediaprint Logistics | Oriental Hotels vs. Iris Clothings Limited | Oriental Hotels vs. Indo Borax Chemicals |
| Industrial Investment vs. Reliance Industries Limited | Industrial Investment vs. Life Insurance | Industrial Investment vs. Indian Oil | Industrial Investment vs. Oil Natural Gas |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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