Correlation Between Infomedia Press and UTI Asset

Can any of the company-specific risk be diversified away by investing in both Infomedia Press and UTI Asset 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 Infomedia Press and UTI Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Infomedia Press Limited and UTI Asset Management, you can compare the effects of market volatilities on Infomedia Press and UTI Asset 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 Infomedia Press with a short position of UTI Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infomedia Press and UTI Asset.

Diversification Opportunities for Infomedia Press and UTI Asset

-0.43

Correlation Coefficient

Infomedia Press  UTI Asset

Very good diversification

The 3 months correlation between Infomedia and UTI is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Infomedia Press Limited and UTI Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UTI Asset Management and Infomedia Press 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 Infomedia Press Limited are associated (or correlated) with UTI Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UTI Asset Management has no effect on the direction of Infomedia Press i.e., Infomedia Press and UTI Asset go up and down completely randomly.

Pair Corralation between Infomedia Press and UTI Asset

Assuming the 90 days trading horizon Infomedia Press is expected to generate 32.88 times less return on investment than UTI Asset. In addition to that, Infomedia Press is 1.26 times more volatile than UTI Asset Management. It trades about 0.0 of its total potential returns per unit of risk. UTI Asset Management is currently generating about 0.11 per unit of volatility. If you would invest  101,602  in UTI Asset Management on October 8, 2024 and sell it today you would earn a total of  34,618  from holding UTI Asset Management or generate 34.07% return on investment over 90 days.

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

Infomedia Press Limited  vs.  UTI Asset Management

Infomedia Press

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Infomedia Press Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's fundamental indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

UTI Asset Management

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in UTI Asset Management are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, UTI Asset sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Infomedia Press and UTI Asset

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

The idea behind Infomedia Press Limited and UTI Asset Management 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.