Correlation Between Viceroy Hotels and GTL
Can any of the company-specific risk be diversified away by investing in both Viceroy Hotels and GTL 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 Viceroy Hotels and GTL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Viceroy Hotels Limited and GTL Limited, you can compare the effects of market volatilities on Viceroy Hotels and GTL 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 Viceroy Hotels with a short position of GTL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viceroy Hotels and GTL.
Diversification Opportunities for Viceroy Hotels and GTL
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Viceroy and GTL is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Viceroy Hotels Limited and GTL Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GTL Limited and Viceroy 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 Viceroy Hotels Limited are associated (or correlated) with GTL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GTL Limited has no effect on the direction of Viceroy Hotels i.e., Viceroy Hotels and GTL go up and down completely randomly.
Pair Corralation between Viceroy Hotels and GTL
Assuming the 90 days trading horizon Viceroy Hotels Limited is expected to generate 0.65 times more return on investment than GTL. However, Viceroy Hotels Limited is 1.54 times less risky than GTL. It trades about 0.0 of its potential returns per unit of risk. GTL Limited is currently generating about -0.02 per unit of risk. If you would invest 11,978 in Viceroy Hotels Limited on November 3, 2024 and sell it today you would lose (466.00) from holding Viceroy Hotels Limited or give up 3.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Viceroy Hotels Limited vs. GTL Limited
Performance |
| Timeline |
| Viceroy Hotels |
| GTL Limited |
Viceroy Hotels and GTL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Viceroy Hotels and GTL
The main advantage of trading using opposite Viceroy Hotels and GTL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Viceroy Hotels position performs unexpectedly, GTL 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 GTL will offset losses from the drop in GTL's long position.| Viceroy Hotels vs. JSW Steel Limited | Viceroy Hotels vs. ROUTE MOBILE LIMITED | Viceroy Hotels vs. OnMobile Global Limited | Viceroy Hotels vs. NMDC Steel Limited |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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