Correlation Between Mondee Holdings and Skillful Craftsman

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

By analyzing existing cross correlation between Mondee Holdings and Skillful Craftsman Education, you can compare the effects of market volatilities on Mondee Holdings and Skillful Craftsman 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 Mondee Holdings with a short position of Skillful Craftsman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mondee Holdings and Skillful Craftsman.

Diversification Opportunities for Mondee Holdings and Skillful Craftsman

-0.18

Correlation Coefficient

Mondee Holdings  Skillful Craftsman

Good diversification

The 3 months correlation between Mondee and Skillful is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Mondee Holdings and Skillful Craftsman Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Skillful Craftsman and Mondee Holdings 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 Mondee Holdings are associated (or correlated) with Skillful Craftsman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Skillful Craftsman has no effect on the direction of Mondee Holdings i.e., Mondee Holdings and Skillful Craftsman go up and down completely randomly.

Pair Corralation between Mondee Holdings and Skillful Craftsman

Given the investment horizon of 90 days Mondee Holdings is expected to under-perform the Skillful Craftsman. But the stock apears to be less risky and, when comparing its historical volatility, Mondee Holdings is 1.06 times less risky than Skillful Craftsman. The stock trades about -0.15 of its potential returns per unit of risk. The Skillful Craftsman Education is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  94.00  in Skillful Craftsman Education on March 21, 2024 and sell it today you would earn a total of  11.00  from holding Skillful Craftsman Education or generate 11.7% return on investment over 90 days.

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

Mondee Holdings  vs.  Skillful Craftsman Education

Mondee Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mondee Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Mondee Holdings is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Skillful Craftsman

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Skillful Craftsman Education are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Skillful Craftsman may actually be approaching a critical reversion point that can send shares even higher in July 2024.

Pair Trading with Mondee Holdings and Skillful Craftsman

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

The idea behind Mondee Holdings and Skillful Craftsman 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.