Correlation Between Yatra Online and FSN E

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

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

Diversification Opportunities for Yatra Online and FSN E

0.69

Correlation Coefficient

Yatra Online  FSN E

Poor diversification

The 3 months correlation between Yatra and FSN is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Yatra Online Limited and FSN E Commerce Ventures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FSN E Commerce and Yatra Online 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 Yatra Online Limited are associated (or correlated) with FSN E. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FSN E Commerce has no effect on the direction of Yatra Online i.e., Yatra Online and FSN E go up and down completely randomly.

Pair Corralation between Yatra Online and FSN E

Assuming the 90 days trading horizon Yatra Online is expected to generate 2.37 times less return on investment than FSN E. In addition to that, Yatra Online is 1.43 times more volatile than FSN E Commerce Ventures. It trades about 0.03 of its total potential returns per unit of risk. FSN E Commerce Ventures is currently generating about 0.1 per unit of volatility. If you would invest  16,604  in FSN E Commerce Ventures on October 10, 2024 and sell it today you would earn a total of  627.00  from holding FSN E Commerce Ventures or generate 3.78% return on investment over 90 days.

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

Yatra Online Limited  vs.  FSN E Commerce Ventures

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 latest uncertain performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

FSN E Commerce

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days FSN E Commerce Ventures has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's forward-looking signals remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Yatra Online and FSN E

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

The idea behind Yatra Online Limited and FSN E Commerce Ventures 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.

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.