Correlation Between Industrial Investment and Yatra Online

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

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

Diversification Opportunities for Industrial Investment and Yatra Online

-0.26

Correlation Coefficient

Industrial Investment  Yatra Online

Very good diversification

The 3 months correlation between Industrial and Yatra is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Industrial Investment Trust 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 Industrial Investment 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 Industrial Investment Trust 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 Industrial Investment i.e., Industrial Investment and Yatra Online go up and down completely randomly.

Pair Corralation between Industrial Investment and Yatra Online

Assuming the 90 days trading horizon Industrial Investment Trust is expected to generate 1.64 times more return on investment than Yatra Online. However, Industrial Investment is 1.64 times more volatile than Yatra Online Limited. It trades about 0.01 of its potential returns per unit of risk. Yatra Online Limited is currently generating about -0.21 per unit of risk. If you would invest  38,135  in Industrial Investment Trust on October 25, 2024 and sell it today you would lose (45.00) from holding Industrial Investment Trust or give up 0.12% of portfolio value over 90 days.

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

Industrial Investment Trust  vs.  Yatra Online Limited

Industrial Investment

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Industrial Investment Trust are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Industrial Investment unveiled solid returns over the last few months and may actually be approaching a breakup point.

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 very healthy basic indicators, Yatra Online is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Industrial Investment and Yatra Online

The main advantage of trading using opposite Industrial Investment and Yatra Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial Investment 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 Industrial Investment Trust 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.