Correlation Between Dalata Hotel and FIH MOBILE

Can any of the company-specific risk be diversified away by investing in both Dalata Hotel and FIH MOBILE 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 Dalata Hotel and FIH MOBILE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dalata Hotel Group and FIH MOBILE, you can compare the effects of market volatilities on Dalata Hotel and FIH MOBILE 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 Dalata Hotel with a short position of FIH MOBILE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dalata Hotel and FIH MOBILE.

Diversification Opportunities for Dalata Hotel and FIH MOBILE

0.64

Correlation Coefficient

Dalata Hotel  FIH MOBILE

Poor diversification

The 3 months correlation between Dalata and FIH is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Dalata Hotel Group and FIH MOBILE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIH MOBILE and Dalata Hotel 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 Dalata Hotel Group are associated (or correlated) with FIH MOBILE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIH MOBILE has no effect on the direction of Dalata Hotel i.e., Dalata Hotel and FIH MOBILE go up and down completely randomly.

Pair Corralation between Dalata Hotel and FIH MOBILE

If you would invest  459.00  in Dalata Hotel Group on October 25, 2024 and sell it today you would earn a total of  25.00  from holding Dalata Hotel Group or generate 5.45% return on investment over 90 days.

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

Dalata Hotel Group  vs.  FIH MOBILE

Dalata Hotel Group

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Dalata Hotel Group are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Dalata Hotel reported solid returns over the last few months and may actually be approaching a breakup point.

FIH MOBILE

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in FIH MOBILE are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, FIH MOBILE may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Dalata Hotel and FIH MOBILE

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

The idea behind Dalata Hotel Group and FIH MOBILE 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.

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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.