Correlation Between Samhi Hotels and Agro Tech
Can any of the company-specific risk be diversified away by investing in both Samhi Hotels and Agro Tech at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Samhi Hotels and Agro Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samhi Hotels Limited and Agro Tech Foods, you can compare the effects of market volatilities on Samhi Hotels and Agro Tech 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 Samhi Hotels with a short position of Agro Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samhi Hotels and Agro Tech.
Diversification Opportunities for Samhi Hotels and Agro Tech
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Samhi and Agro is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Samhi Hotels Limited and Agro Tech Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agro Tech Foods and Samhi 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 Samhi Hotels Limited are associated (or correlated) with Agro Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agro Tech Foods has no effect on the direction of Samhi Hotels i.e., Samhi Hotels and Agro Tech go up and down completely randomly.
Pair Corralation between Samhi Hotels and Agro Tech
Assuming the 90 days trading horizon Samhi Hotels Limited is expected to generate 0.96 times more return on investment than Agro Tech. However, Samhi Hotels Limited is 1.04 times less risky than Agro Tech. It trades about 0.05 of its potential returns per unit of risk. Agro Tech Foods is currently generating about 0.01 per unit of risk. If you would invest 14,340 in Samhi Hotels Limited on October 13, 2024 and sell it today you would earn a total of 4,688 from holding Samhi Hotels Limited or generate 32.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 66.12% |
| Values | Daily Returns |
Samhi Hotels Limited vs. Agro Tech Foods
Performance |
| Timeline |
| Samhi Hotels Limited |
| Agro Tech Foods |
Samhi Hotels and Agro Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samhi Hotels and Agro Tech
The main advantage of trading using opposite Samhi Hotels and Agro Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samhi Hotels position performs unexpectedly, Agro Tech 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 Agro Tech will offset losses from the drop in Agro Tech's long position.| Samhi Hotels vs. Sonata Software Limited | Samhi Hotels vs. Le Travenues Technology | Samhi Hotels vs. Newgen Software Technologies | Samhi Hotels vs. Kaynes Technology India |
| Agro Tech vs. Som Distilleries Breweries | Agro Tech vs. Oriental Hotels Limited | Agro Tech vs. Samhi Hotels Limited | Agro Tech vs. Salzer Electronics 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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