Correlation Between YATRA ONLINE and Algonquin Power

Can any of the company-specific risk be diversified away by investing in both YATRA ONLINE and Algonquin Power 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 Algonquin Power into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between YATRA ONLINE DL 0001 and Algonquin Power Utilities, you can compare the effects of market volatilities on YATRA ONLINE and Algonquin Power 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 Algonquin Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of YATRA ONLINE and Algonquin Power.

Diversification Opportunities for YATRA ONLINE and Algonquin Power

-0.35

Correlation Coefficient

YATRA ONLINE  Algonquin Power

Very good diversification

The 3 months correlation between YATRA and Algonquin is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding YATRA ONLINE DL 0001 and Algonquin Power Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Algonquin Power Utilities 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 DL 0001 are associated (or correlated) with Algonquin Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Algonquin Power Utilities has no effect on the direction of YATRA ONLINE i.e., YATRA ONLINE and Algonquin Power go up and down completely randomly.

Pair Corralation between YATRA ONLINE and Algonquin Power

Assuming the 90 days horizon YATRA ONLINE DL 0001 is expected to under-perform the Algonquin Power. In addition to that, YATRA ONLINE is 1.64 times more volatile than Algonquin Power Utilities. It trades about -0.22 of its total potential returns per unit of risk. Algonquin Power Utilities is currently generating about 0.02 per unit of volatility. If you would invest  450.00  in Algonquin Power Utilities on December 1, 2024 and sell it today you would earn a total of  5.00  from holding Algonquin Power Utilities or generate 1.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

YATRA ONLINE DL 0001  vs.  Algonquin Power Utilities

YATRA ONLINE DL

Risk-Adjusted Performance

Very Weak

Over the last 90 days YATRA ONLINE DL 0001 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Algonquin Power Utilities

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Algonquin Power Utilities are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Algonquin Power is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with YATRA ONLINE and Algonquin Power

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

The idea behind YATRA ONLINE DL 0001 and Algonquin Power Utilities 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.