Correlation Between Dhunseri Investments and GPT Healthcare

Can any of the company-specific risk be diversified away by investing in both Dhunseri Investments and GPT Healthcare 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 Dhunseri Investments and GPT Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dhunseri Investments Limited and GPT Healthcare, you can compare the effects of market volatilities on Dhunseri Investments and GPT Healthcare 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 Dhunseri Investments with a short position of GPT Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dhunseri Investments and GPT Healthcare.

Diversification Opportunities for Dhunseri Investments and GPT Healthcare

0.04

Correlation Coefficient

Dhunseri Investments  GPT Healthcare

Significant diversification

The 3 months correlation between Dhunseri and GPT is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Dhunseri Investments Limited and GPT Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GPT Healthcare and Dhunseri Investments 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 Dhunseri Investments Limited are associated (or correlated) with GPT Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GPT Healthcare has no effect on the direction of Dhunseri Investments i.e., Dhunseri Investments and GPT Healthcare go up and down completely randomly.

Pair Corralation between Dhunseri Investments and GPT Healthcare

Assuming the 90 days trading horizon Dhunseri Investments Limited is expected to under-perform the GPT Healthcare. But the stock apears to be less risky and, when comparing its historical volatility, Dhunseri Investments Limited is 1.04 times less risky than GPT Healthcare. The stock trades about -0.51 of its potential returns per unit of risk. The GPT Healthcare is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  17,705  in GPT Healthcare on September 29, 2024 and sell it today you would earn a total of  682.00  from holding GPT Healthcare or generate 3.85% return on investment over 90 days.

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

Dhunseri Investments Limited  vs.  GPT Healthcare

Dhunseri Investments

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dhunseri Investments Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's forward indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

GPT Healthcare

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in GPT Healthcare are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent essential indicators, GPT Healthcare is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Dhunseri Investments and GPT Healthcare

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

The idea behind Dhunseri Investments Limited and GPT Healthcare 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.