Correlation Between EIH Associated and Edelweiss Financial
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By analyzing existing cross correlation between EIH Associated Hotels and Edelweiss Financial Services, you can compare the effects of market volatilities on EIH Associated and Edelweiss Financial 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 EIH Associated with a short position of Edelweiss Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of EIH Associated and Edelweiss Financial.
Diversification Opportunities for EIH Associated and Edelweiss Financial
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between EIH and Edelweiss is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding EIH Associated Hotels and Edelweiss Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Edelweiss Financial and EIH Associated 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 EIH Associated Hotels are associated (or correlated) with Edelweiss Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Edelweiss Financial has no effect on the direction of EIH Associated i.e., EIH Associated and Edelweiss Financial go up and down completely randomly.
Pair Corralation between EIH Associated and Edelweiss Financial
Assuming the 90 days trading horizon EIH Associated Hotels is expected to generate 0.63 times more return on investment than Edelweiss Financial. However, EIH Associated Hotels is 1.58 times less risky than Edelweiss Financial. It trades about 0.02 of its potential returns per unit of risk. Edelweiss Financial Services is currently generating about -0.02 per unit of risk. If you would invest 39,750 in EIH Associated Hotels on September 25, 2024 and sell it today you would earn a total of 680.00 from holding EIH Associated Hotels or generate 1.71% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
EIH Associated Hotels vs. Edelweiss Financial Services
Performance |
Timeline |
EIH Associated Hotels |
Edelweiss Financial |
EIH Associated and Edelweiss Financial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with EIH Associated and Edelweiss Financial
The main advantage of trading using opposite EIH Associated and Edelweiss Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EIH Associated position performs unexpectedly, Edelweiss Financial 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 Edelweiss Financial will offset losses from the drop in Edelweiss Financial's long position.EIH Associated vs. Kaushalya Infrastructure Development | EIH Associated vs. Tarapur Transformers Limited | EIH Associated vs. Kingfa Science Technology | EIH Associated vs. Rico Auto Industries |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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