Correlation Between Kisan Telecom and Xavis Co

Can any of the company-specific risk be diversified away by investing in both Kisan Telecom and Xavis Co 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 Kisan Telecom and Xavis Co into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Kisan Telecom Co and Xavis Co, you can compare the effects of market volatilities on Kisan Telecom and Xavis Co 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 Kisan Telecom with a short position of Xavis Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kisan Telecom and Xavis Co.

Diversification Opportunities for Kisan Telecom and Xavis Co

0.92

Correlation Coefficient

Kisan Telecom  Xavis Co

Almost no diversification

The 3 months correlation between Kisan and Xavis is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Kisan Telecom Co and Xavis Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xavis Co and Kisan Telecom 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 Kisan Telecom Co are associated (or correlated) with Xavis Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xavis Co has no effect on the direction of Kisan Telecom i.e., Kisan Telecom and Xavis Co go up and down completely randomly.

Pair Corralation between Kisan Telecom and Xavis Co

Assuming the 90 days trading horizon Kisan Telecom is expected to generate 1.5 times less return on investment than Xavis Co. But when comparing it to its historical volatility, Kisan Telecom Co is 1.03 times less risky than Xavis Co. It trades about 0.07 of its potential returns per unit of risk. Xavis Co is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  129,100  in Xavis Co on December 22, 2024 and sell it today you would earn a total of  29,000  from holding Xavis Co or generate 22.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	98.28%
Values	Daily Returns

Kisan Telecom Co  vs.  Xavis Co

Kisan Telecom

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Kisan Telecom Co are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Kisan Telecom sustained solid returns over the last few months and may actually be approaching a breakup point.

Xavis Co

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Xavis Co are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Xavis Co sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kisan Telecom and Xavis Co

The main advantage of trading using opposite Kisan Telecom and Xavis Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kisan Telecom position performs unexpectedly, Xavis Co 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 Xavis Co will offset losses from the drop in Xavis Co's long position.

The idea behind Kisan Telecom Co and Xavis Co 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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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.