Correlation Between AUTHUM INVESTMENT and Kewal Kiran

Can any of the company-specific risk be diversified away by investing in both AUTHUM INVESTMENT and Kewal Kiran 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 AUTHUM INVESTMENT and Kewal Kiran into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AUTHUM INVESTMENT INFRASTRUCTU and Kewal Kiran Clothing, you can compare the effects of market volatilities on AUTHUM INVESTMENT and Kewal Kiran 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 AUTHUM INVESTMENT with a short position of Kewal Kiran. Check out your portfolio center. Please also check ongoing floating volatility patterns of AUTHUM INVESTMENT and Kewal Kiran.

Diversification Opportunities for AUTHUM INVESTMENT and Kewal Kiran

0.52

Correlation Coefficient

AUTHUM INVESTMENT  Kewal Kiran

Very weak diversification

The 3 months correlation between AUTHUM and Kewal is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding AUTHUM INVESTMENT INFRASTRUCTU and Kewal Kiran Clothing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kewal Kiran Clothing and AUTHUM INVESTMENT 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 AUTHUM INVESTMENT INFRASTRUCTU are associated (or correlated) with Kewal Kiran. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kewal Kiran Clothing has no effect on the direction of AUTHUM INVESTMENT i.e., AUTHUM INVESTMENT and Kewal Kiran go up and down completely randomly.

Pair Corralation between AUTHUM INVESTMENT and Kewal Kiran

Assuming the 90 days trading horizon AUTHUM INVESTMENT INFRASTRUCTU is expected to generate 1.38 times more return on investment than Kewal Kiran. However, AUTHUM INVESTMENT is 1.38 times more volatile than Kewal Kiran Clothing. It trades about 0.17 of its potential returns per unit of risk. Kewal Kiran Clothing is currently generating about 0.06 per unit of risk. If you would invest  156,580  in AUTHUM INVESTMENT INFRASTRUCTU on September 22, 2024 and sell it today you would earn a total of  13,030  from holding AUTHUM INVESTMENT INFRASTRUCTU or generate 8.32% return on investment over 90 days.

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

AUTHUM INVESTMENT INFRASTRUCTU  vs.  Kewal Kiran Clothing

AUTHUM INVESTMENT

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AUTHUM INVESTMENT INFRASTRUCTU has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, AUTHUM INVESTMENT is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Kewal Kiran Clothing

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kewal Kiran Clothing has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with AUTHUM INVESTMENT and Kewal Kiran

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

The idea behind AUTHUM INVESTMENT INFRASTRUCTU and Kewal Kiran Clothing 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.