Correlation Between Home First and Yatra Online

Can any of the company-specific risk be diversified away by investing in both Home First and Yatra Online 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 Home First and Yatra Online into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Home First Finance and Yatra Online Limited, you can compare the effects of market volatilities on Home First and Yatra Online 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 Home First with a short position of Yatra Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home First and Yatra Online.

Diversification Opportunities for Home First and Yatra Online

0.37

Correlation Coefficient

Home First  Yatra Online

Weak diversification

The 3 months correlation between Home and Yatra is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Home First Finance and Yatra Online Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yatra Online Limited and Home First 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 Home First Finance are associated (or correlated) with Yatra Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yatra Online Limited has no effect on the direction of Home First i.e., Home First and Yatra Online go up and down completely randomly.

Pair Corralation between Home First and Yatra Online

Assuming the 90 days trading horizon Home First Finance is expected to generate 0.79 times more return on investment than Yatra Online. However, Home First Finance is 1.26 times less risky than Yatra Online. It trades about 0.1 of its potential returns per unit of risk. Yatra Online Limited is currently generating about -0.14 per unit of risk. If you would invest  100,010  in Home First Finance on October 21, 2024 and sell it today you would earn a total of  3,010  from holding Home First Finance or generate 3.01% return on investment over 90 days.

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

Home First Finance  vs.  Yatra Online Limited

Home First Finance

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Home First Finance has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest uncertain performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Yatra Online Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Yatra Online Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Home First and Yatra Online

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

The idea behind Home First Finance and Yatra Online Limited 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.