Correlation Between Unitech and G Tec

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

By analyzing existing cross correlation between Unitech Limited and G Tec Jainx Education, you can compare the effects of market volatilities on Unitech and G Tec 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 Unitech with a short position of G Tec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unitech and G Tec.

Diversification Opportunities for Unitech and G Tec

0.53

Correlation Coefficient

Unitech  G Tec

Very weak diversification

The 3 months correlation between Unitech and GTECJAINX is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Unitech Limited and G Tec Jainx Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G Tec Jainx and Unitech 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 Unitech Limited are associated (or correlated) with G Tec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G Tec Jainx has no effect on the direction of Unitech i.e., Unitech and G Tec go up and down completely randomly.

Pair Corralation between Unitech and G Tec

Assuming the 90 days trading horizon Unitech Limited is expected to generate 1.08 times more return on investment than G Tec. However, Unitech is 1.08 times more volatile than G Tec Jainx Education. It trades about 0.02 of its potential returns per unit of risk. G Tec Jainx Education is currently generating about -0.28 per unit of risk. If you would invest  943.00  in Unitech Limited on September 4, 2024 and sell it today you would earn a total of  7.00  from holding Unitech Limited or generate 0.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

Unitech Limited  vs.  G Tec Jainx Education

Unitech Limited

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Unitech Limited are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong technical and fundamental indicators, Unitech is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

G Tec Jainx

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days G Tec Jainx Education has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Unitech and G Tec

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

The idea behind Unitech Limited and G Tec Jainx Education 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.