Correlation Between Yatra Online and Amadeus IT

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

By analyzing existing cross correlation between Yatra Online and Amadeus IT Holding, you can compare the effects of market volatilities on Yatra Online and Amadeus IT 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 Amadeus IT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yatra Online and Amadeus IT.

Diversification Opportunities for Yatra Online and Amadeus IT

-0.88

Correlation Coefficient

Yatra Online  Amadeus IT

Pay attention - limited upside

The 3 months correlation between Yatra and Amadeus is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Yatra Online and Amadeus IT Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amadeus IT Holding 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 are associated (or correlated) with Amadeus IT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amadeus IT Holding has no effect on the direction of Yatra Online i.e., Yatra Online and Amadeus IT go up and down completely randomly.

Pair Corralation between Yatra Online and Amadeus IT

Given the investment horizon of 90 days Yatra Online is expected to under-perform the Amadeus IT. In addition to that, Yatra Online is 1.96 times more volatile than Amadeus IT Holding. It trades about -0.22 of its total potential returns per unit of risk. Amadeus IT Holding is currently generating about 0.15 per unit of volatility. If you would invest  7,018  in Amadeus IT Holding on December 29, 2024 and sell it today you would earn a total of  975.00  from holding Amadeus IT Holding or generate 13.89% return on investment over 90 days.

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

Yatra Online  vs.  Amadeus IT Holding

Yatra Online

Risk-Adjusted Performance

Very Weak

Over the last 90 days Yatra Online 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 somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Amadeus IT Holding

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Amadeus IT Holding are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal fundamental indicators, Amadeus IT showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Yatra Online and Amadeus IT

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

The idea behind Yatra Online and Amadeus IT Holding 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.