Correlation Between Corporate Travel and NTT DATA

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

By analyzing existing cross correlation between Corporate Travel Management and NTT DATA , you can compare the effects of market volatilities on Corporate Travel and NTT DATA 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 Corporate Travel with a short position of NTT DATA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Corporate Travel and NTT DATA.

Diversification Opportunities for Corporate Travel and NTT DATA

0.14

Correlation Coefficient

Corporate Travel  NTT DATA

Average diversification

The 3 months correlation between Corporate and NTT is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Corporate Travel Management and NTT DATA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NTT DATA and Corporate Travel 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 Corporate Travel Management are associated (or correlated) with NTT DATA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NTT DATA has no effect on the direction of Corporate Travel i.e., Corporate Travel and NTT DATA go up and down completely randomly.

Pair Corralation between Corporate Travel and NTT DATA

Assuming the 90 days trading horizon Corporate Travel Management is expected to under-perform the NTT DATA. In addition to that, Corporate Travel is 1.04 times more volatile than NTT DATA . It trades about -0.04 of its total potential returns per unit of risk. NTT DATA is currently generating about 0.15 per unit of volatility. If you would invest  1,692  in NTT DATA on March 23, 2025 and sell it today you would earn a total of  628.00  from holding NTT DATA or generate 37.12% return on investment over 90 days.

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

Corporate Travel Management  vs.  NTT DATA

Corporate Travel Man

Risk-Adjusted Performance

Very Weak

Over the last 90 days Corporate Travel Management has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

NTT DATA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in NTT DATA are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, NTT DATA unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Corporate Travel and NTT DATA

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

The idea behind Corporate Travel Management and NTT DATA 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.