Correlation Between Datamatics Global and Kalyani Investment

Can any of the company-specific risk be diversified away by investing in both Datamatics Global and Kalyani Investment 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 Datamatics Global and Kalyani Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Datamatics Global Services and Kalyani Investment, you can compare the effects of market volatilities on Datamatics Global and Kalyani Investment 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 Datamatics Global with a short position of Kalyani Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Datamatics Global and Kalyani Investment.

Diversification Opportunities for Datamatics Global and Kalyani Investment

-0.48

Correlation Coefficient

Datamatics Global  Kalyani Investment

Very good diversification

The 3 months correlation between Datamatics and Kalyani is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Datamatics Global Services and Kalyani Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kalyani Investment and Datamatics Global 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 Datamatics Global Services are associated (or correlated) with Kalyani Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kalyani Investment has no effect on the direction of Datamatics Global i.e., Datamatics Global and Kalyani Investment go up and down completely randomly.

Pair Corralation between Datamatics Global and Kalyani Investment

Assuming the 90 days trading horizon Datamatics Global Services is expected to generate 0.78 times more return on investment than Kalyani Investment. However, Datamatics Global Services is 1.29 times less risky than Kalyani Investment. It trades about 0.15 of its potential returns per unit of risk. Kalyani Investment is currently generating about 0.03 per unit of risk. If you would invest  56,575  in Datamatics Global Services on October 6, 2024 and sell it today you would earn a total of  12,525  from holding Datamatics Global Services or generate 22.14% return on investment over 90 days.

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

Datamatics Global Services  vs.  Kalyani Investment

Datamatics Global

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Datamatics Global Services are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak forward indicators, Datamatics Global unveiled solid returns over the last few months and may actually be approaching a breakup point.

Kalyani Investment

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Kalyani Investment are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Kalyani Investment is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Datamatics Global and Kalyani Investment

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

The idea behind Datamatics Global Services and Kalyani Investment 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.