Correlation Between TravelSky Technology and Gartner

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

By analyzing existing cross correlation between TravelSky Technology Ltd and Gartner, you can compare the effects of market volatilities on TravelSky Technology and Gartner 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 TravelSky Technology with a short position of Gartner. Check out your portfolio center. Please also check ongoing floating volatility patterns of TravelSky Technology and Gartner.

Diversification Opportunities for TravelSky Technology and Gartner

0.31

Correlation Coefficient

TravelSky Technology  Gartner

Weak diversification

The 3 months correlation between TravelSky and Gartner is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding TravelSky Technology Ltd and Gartner in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gartner and TravelSky Technology 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 TravelSky Technology Ltd are associated (or correlated) with Gartner. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gartner has no effect on the direction of TravelSky Technology i.e., TravelSky Technology and Gartner go up and down completely randomly.

Pair Corralation between TravelSky Technology and Gartner

Assuming the 90 days horizon TravelSky Technology Ltd is expected to generate 2.22 times more return on investment than Gartner. However, TravelSky Technology is 2.22 times more volatile than Gartner. It trades about -0.1 of its potential returns per unit of risk. Gartner is currently generating about -0.29 per unit of risk. If you would invest  1,350  in TravelSky Technology Ltd on October 6, 2024 and sell it today you would lose (73.00) from holding TravelSky Technology Ltd or give up 5.41% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

TravelSky Technology Ltd  vs.  Gartner

TravelSky Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TravelSky Technology Ltd has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Gartner

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gartner has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Gartner is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with TravelSky Technology and Gartner

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

The idea behind TravelSky Technology Ltd and Gartner 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.