Correlation Between Kamat Hotels and WESTLIFE FOODWORLD
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By analyzing existing cross correlation between Kamat Hotels Limited and WESTLIFE FOODWORLD LIMITED, you can compare the effects of market volatilities on Kamat Hotels and WESTLIFE FOODWORLD 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 Kamat Hotels with a short position of WESTLIFE FOODWORLD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kamat Hotels and WESTLIFE FOODWORLD.
Diversification Opportunities for Kamat Hotels and WESTLIFE FOODWORLD
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kamat and WESTLIFE is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Kamat Hotels Limited and WESTLIFE FOODWORLD LIMITED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WESTLIFE FOODWORLD and Kamat Hotels 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 Kamat Hotels Limited are associated (or correlated) with WESTLIFE FOODWORLD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WESTLIFE FOODWORLD has no effect on the direction of Kamat Hotels i.e., Kamat Hotels and WESTLIFE FOODWORLD go up and down completely randomly.
Pair Corralation between Kamat Hotels and WESTLIFE FOODWORLD
Assuming the 90 days trading horizon Kamat Hotels Limited is expected to generate 1.74 times more return on investment than WESTLIFE FOODWORLD. However, Kamat Hotels is 1.74 times more volatile than WESTLIFE FOODWORLD LIMITED. It trades about 0.12 of its potential returns per unit of risk. WESTLIFE FOODWORLD LIMITED is currently generating about -0.07 per unit of risk. If you would invest 18,982 in Kamat Hotels Limited on October 7, 2024 and sell it today you would earn a total of 4,985 from holding Kamat Hotels Limited or generate 26.26% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Kamat Hotels Limited vs. WESTLIFE FOODWORLD LIMITED
Performance |
Timeline |
Kamat Hotels Limited |
WESTLIFE FOODWORLD |
Kamat Hotels and WESTLIFE FOODWORLD Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Kamat Hotels and WESTLIFE FOODWORLD
The main advantage of trading using opposite Kamat Hotels and WESTLIFE FOODWORLD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kamat Hotels position performs unexpectedly, WESTLIFE FOODWORLD 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 WESTLIFE FOODWORLD will offset losses from the drop in WESTLIFE FOODWORLD's long position.Kamat Hotels vs. HMT Limited | ||
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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