Correlation Between Yatra Online and Kingfa Science

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Can any of the company-specific risk be diversified away by investing in both Yatra Online and Kingfa Science 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 Yatra Online and Kingfa Science into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yatra Online Limited and Kingfa Science Technology, you can compare the effects of market volatilities on Yatra Online and Kingfa Science 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 Yatra Online with a short position of Kingfa Science. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yatra Online and Kingfa Science.

Diversification Opportunities for Yatra Online and Kingfa Science

0.89
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Yatra and Kingfa is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Yatra Online Limited and Kingfa Science Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kingfa Science Technology and Yatra Online 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 Yatra Online Limited are associated (or correlated) with Kingfa Science. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kingfa Science Technology has no effect on the direction of Yatra Online i.e., Yatra Online and Kingfa Science go up and down completely randomly.

Pair Corralation between Yatra Online and Kingfa Science

Assuming the 90 days trading horizon Yatra Online Limited is expected to under-perform the Kingfa Science. In addition to that, Yatra Online is 1.17 times more volatile than Kingfa Science Technology. It trades about -0.08 of its total potential returns per unit of risk. Kingfa Science Technology is currently generating about -0.07 per unit of volatility. If you would invest  299,645  in Kingfa Science Technology on August 29, 2024 and sell it today you would lose (10,080) from holding Kingfa Science Technology or give up 3.36% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Yatra Online Limited  vs.  Kingfa Science Technology

 Performance 
       Timeline  
Yatra Online Limited 

Risk-Adjusted Performance

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Weak
 
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Very Weak
Over the last 90 days Yatra Online Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in December 2024. The recent disarray may also be a sign of long period up-swing for the firm investors.
Kingfa Science Technology 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Kingfa Science Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Yatra Online and Kingfa Science Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Yatra Online and Kingfa Science

The main advantage of trading using opposite Yatra Online and Kingfa Science positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yatra Online position performs unexpectedly, Kingfa Science 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 Kingfa Science will offset losses from the drop in Kingfa Science's long position.
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The idea behind Yatra Online Limited and Kingfa Science Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.

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