Correlation Between Taj GVK and Indian Hotels
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By analyzing existing cross correlation between Taj GVK Hotels and The Indian Hotels, you can compare the effects of market volatilities on Taj GVK and Indian Hotels 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 Taj GVK with a short position of Indian Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taj GVK and Indian Hotels.
Diversification Opportunities for Taj GVK and Indian Hotels
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Taj and Indian is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Taj GVK Hotels and The Indian Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indian Hotels and Taj GVK 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 Taj GVK Hotels are associated (or correlated) with Indian Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indian Hotels has no effect on the direction of Taj GVK i.e., Taj GVK and Indian Hotels go up and down completely randomly.
Pair Corralation between Taj GVK and Indian Hotels
Assuming the 90 days trading horizon Taj GVK is expected to generate 1.72 times less return on investment than Indian Hotels. In addition to that, Taj GVK is 1.08 times more volatile than The Indian Hotels. It trades about 0.2 of its total potential returns per unit of risk. The Indian Hotels is currently generating about 0.37 per unit of volatility. If you would invest 66,700 in The Indian Hotels on August 25, 2024 and sell it today you would earn a total of 13,205 from holding The Indian Hotels or generate 19.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Taj GVK Hotels vs. The Indian Hotels
Performance |
| Timeline |
| Taj GVK Hotels |
| Indian Hotels |
Taj GVK and Indian Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Taj GVK and Indian Hotels
The main advantage of trading using opposite Taj GVK and Indian Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taj GVK position performs unexpectedly, Indian Hotels 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 Indian Hotels will offset losses from the drop in Indian Hotels' long position.| Taj GVK vs. Reliance Industries Limited | Taj GVK vs. Indian Oil | Taj GVK vs. HDFC Bank Limited | Taj GVK vs. Divis Laboratories Limited |
| Indian Hotels vs. Reliance Industries Limited | Indian Hotels vs. Indian Oil | Indian Hotels vs. HDFC Bank Limited | Indian Hotels vs. Divis Laboratories 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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