Correlation Between Yes Bank and Ganesh Housing

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

By analyzing existing cross correlation between Yes Bank Limited and Ganesh Housing, you can compare the effects of market volatilities on Yes Bank and Ganesh Housing 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 Yes Bank with a short position of Ganesh Housing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yes Bank and Ganesh Housing.

Diversification Opportunities for Yes Bank and Ganesh Housing

-0.45

Correlation Coefficient

Yes Bank  Ganesh Housing

Very good diversification

The 3 months correlation between Yes and Ganesh is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Yes Bank Limited and Ganesh Housing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ganesh Housing and Yes Bank 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 Yes Bank Limited are associated (or correlated) with Ganesh Housing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ganesh Housing has no effect on the direction of Yes Bank i.e., Yes Bank and Ganesh Housing go up and down completely randomly.

Pair Corralation between Yes Bank and Ganesh Housing

Assuming the 90 days trading horizon Yes Bank Limited is expected to generate 0.76 times more return on investment than Ganesh Housing. However, Yes Bank Limited is 1.31 times less risky than Ganesh Housing. It trades about -0.05 of its potential returns per unit of risk. Ganesh Housing is currently generating about -0.13 per unit of risk. If you would invest  2,014  in Yes Bank Limited on September 27, 2024 and sell it today you would lose (34.00) from holding Yes Bank Limited or give up 1.69% of portfolio value over 90 days.

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

Yes Bank Limited  vs.  Ganesh Housing

Yes Bank Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Yes Bank Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Ganesh Housing

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ganesh Housing are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, Ganesh Housing demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Yes Bank and Ganesh Housing

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

The idea behind Yes Bank Limited and Ganesh Housing 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.