Correlation Between Kaushalya Infrastructure and Blue Jet

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

By analyzing existing cross correlation between Kaushalya Infrastructure Development and Blue Jet Healthcare, you can compare the effects of market volatilities on Kaushalya Infrastructure and Blue Jet 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 Kaushalya Infrastructure with a short position of Blue Jet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaushalya Infrastructure and Blue Jet.

Diversification Opportunities for Kaushalya Infrastructure and Blue Jet

0.32

Correlation Coefficient

Kaushalya Infrastructure  Blue Jet

Weak diversification

The 3 months correlation between Kaushalya and Blue is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Kaushalya Infrastructure Devel and Blue Jet Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Jet Healthcare and Kaushalya Infrastructure 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 Kaushalya Infrastructure Development are associated (or correlated) with Blue Jet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Jet Healthcare has no effect on the direction of Kaushalya Infrastructure i.e., Kaushalya Infrastructure and Blue Jet go up and down completely randomly.

Pair Corralation between Kaushalya Infrastructure and Blue Jet

Assuming the 90 days trading horizon Kaushalya Infrastructure Development is expected to generate 0.8 times more return on investment than Blue Jet. However, Kaushalya Infrastructure Development is 1.25 times less risky than Blue Jet. It trades about 0.06 of its potential returns per unit of risk. Blue Jet Healthcare is currently generating about 0.01 per unit of risk. If you would invest  93,850  in Kaushalya Infrastructure Development on September 12, 2024 and sell it today you would earn a total of  6,310  from holding Kaushalya Infrastructure Development or generate 6.72% return on investment over 90 days.

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

Kaushalya Infrastructure Devel  vs.  Blue Jet Healthcare

Kaushalya Infrastructure

Risk-Adjusted Performance

4 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kaushalya Infrastructure Development are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite weak essential indicators, Kaushalya Infrastructure may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Blue Jet Healthcare

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Blue Jet Healthcare has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward-looking indicators, Blue Jet 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 Kaushalya Infrastructure and Blue Jet

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

The idea behind Kaushalya Infrastructure Development and Blue Jet Healthcare 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..