Correlation Between Hemisphere Properties and Indian Card

Can any of the company-specific risk be diversified away by investing in both Hemisphere Properties and Indian Card 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 Hemisphere Properties and Indian Card into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hemisphere Properties India and Indian Card Clothing, you can compare the effects of market volatilities on Hemisphere Properties and Indian Card 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 Hemisphere Properties with a short position of Indian Card. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hemisphere Properties and Indian Card.

Diversification Opportunities for Hemisphere Properties and Indian Card

0.55

Correlation Coefficient

Hemisphere Properties  Indian Card

Very weak diversification

The 3 months correlation between Hemisphere and Indian is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Hemisphere Properties India and Indian Card Clothing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indian Card Clothing and Hemisphere Properties 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 Hemisphere Properties India are associated (or correlated) with Indian Card. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indian Card Clothing has no effect on the direction of Hemisphere Properties i.e., Hemisphere Properties and Indian Card go up and down completely randomly.

Pair Corralation between Hemisphere Properties and Indian Card

Assuming the 90 days trading horizon Hemisphere Properties India is expected to under-perform the Indian Card. But the stock apears to be less risky and, when comparing its historical volatility, Hemisphere Properties India is 1.35 times less risky than Indian Card. The stock trades about -0.17 of its potential returns per unit of risk. The Indian Card Clothing is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  26,680  in Indian Card Clothing on December 2, 2024 and sell it today you would lose (2,520) from holding Indian Card Clothing or give up 9.45% of portfolio value over 90 days.

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

Hemisphere Properties India  vs.  Indian Card Clothing

Hemisphere Properties

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hemisphere Properties India has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Indian Card Clothing

Risk-Adjusted Performance

Very Weak

Over the last 90 days Indian Card Clothing has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Indian Card is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Hemisphere Properties and Indian Card

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

The idea behind Hemisphere Properties India and Indian Card 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 CEOs Directory module to screen CEOs from public companies around the world.