Correlation Between Swvl Holdings and Lytus Technologies
Can any of the company-specific risk be diversified away by investing in both Swvl Holdings and Lytus Technologies 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 Swvl Holdings and Lytus Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swvl Holdings Corp and Lytus Technologies Holdings, you can compare the effects of market volatilities on Swvl Holdings and Lytus Technologies 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 Swvl Holdings with a short position of Lytus Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swvl Holdings and Lytus Technologies.
Diversification Opportunities for Swvl Holdings and Lytus Technologies
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Swvl and Lytus is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Swvl Holdings Corp and Lytus Technologies Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lytus Technologies and Swvl Holdings 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 Swvl Holdings Corp are associated (or correlated) with Lytus Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lytus Technologies has no effect on the direction of Swvl Holdings i.e., Swvl Holdings and Lytus Technologies go up and down completely randomly.
Pair Corralation between Swvl Holdings and Lytus Technologies
Assuming the 90 days horizon Swvl Holdings Corp is expected to generate 0.56 times more return on investment than Lytus Technologies. However, Swvl Holdings Corp is 1.79 times less risky than Lytus Technologies. It trades about 0.11 of its potential returns per unit of risk. Lytus Technologies Holdings is currently generating about -0.25 per unit of risk. If you would invest 1.54 in Swvl Holdings Corp on December 5, 2024 and sell it today you would earn a total of 0.17 from holding Swvl Holdings Corp or generate 11.04% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 71.43% |
Values | Daily Returns |
Swvl Holdings Corp vs. Lytus Technologies Holdings
Performance |
Timeline |
Swvl Holdings Corp |
Lytus Technologies |
Swvl Holdings and Lytus Technologies Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Swvl Holdings and Lytus Technologies
The main advantage of trading using opposite Swvl Holdings and Lytus Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swvl Holdings position performs unexpectedly, Lytus Technologies 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 Lytus Technologies will offset losses from the drop in Lytus Technologies' long position.The idea behind Swvl Holdings Corp and Lytus Technologies Holdings 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.Lytus Technologies vs. RenoWorks Software | Lytus Technologies vs. 01 Communique Laboratory | Lytus Technologies vs. LifeSpeak | Lytus Technologies vs. KwikClick |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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