Correlation Between Hindware Home and Yatharth Hospital

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

By analyzing existing cross correlation between Hindware Home Innovation and Yatharth Hospital Trauma, you can compare the effects of market volatilities on Hindware Home and Yatharth Hospital 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 Hindware Home with a short position of Yatharth Hospital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hindware Home and Yatharth Hospital.

Diversification Opportunities for Hindware Home and Yatharth Hospital

-0.48

Correlation Coefficient

Hindware Home  Yatharth Hospital

Very good diversification

The 3 months correlation between Hindware and Yatharth is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Hindware Home Innovation and Yatharth Hospital Trauma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yatharth Hospital Trauma and Hindware Home 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 Hindware Home Innovation are associated (or correlated) with Yatharth Hospital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yatharth Hospital Trauma has no effect on the direction of Hindware Home i.e., Hindware Home and Yatharth Hospital go up and down completely randomly.

Pair Corralation between Hindware Home and Yatharth Hospital

Assuming the 90 days trading horizon Hindware Home Innovation is expected to under-perform the Yatharth Hospital. In addition to that, Hindware Home is 1.12 times more volatile than Yatharth Hospital Trauma. It trades about -0.1 of its total potential returns per unit of risk. Yatharth Hospital Trauma is currently generating about 0.07 per unit of volatility. If you would invest  56,830  in Yatharth Hospital Trauma on September 12, 2024 and sell it today you would earn a total of  5,915  from holding Yatharth Hospital Trauma or generate 10.41% return on investment over 90 days.

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

Hindware Home Innovation  vs.  Yatharth Hospital Trauma

Hindware Home Innovation

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hindware Home Innovation has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Yatharth Hospital Trauma

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Yatharth Hospital Trauma are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Yatharth Hospital may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Hindware Home and Yatharth Hospital

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

The idea behind Hindware Home Innovation and Yatharth Hospital Trauma 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.