Correlation Between Orient Telecoms and River

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

By analyzing existing cross correlation between Orient Telecoms and River and Mercantile, you can compare the effects of market volatilities on Orient Telecoms and River 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 Orient Telecoms with a short position of River. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orient Telecoms and River.

Diversification Opportunities for Orient Telecoms and River

0.0

Correlation Coefficient

Orient Telecoms  River

Pay attention - limited upside

The 3 months correlation between Orient and River is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Orient Telecoms and River and Mercantile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on River and Mercantile and Orient Telecoms 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 Orient Telecoms are associated (or correlated) with River. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of River and Mercantile has no effect on the direction of Orient Telecoms i.e., Orient Telecoms and River go up and down completely randomly.

Pair Corralation between Orient Telecoms and River

If you would invest  16,000  in River and Mercantile on April 24, 2025 and sell it today you would earn a total of  3,200  from holding River and Mercantile or generate 20.0% return on investment over 90 days.

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

Orient Telecoms  vs.  River and Mercantile

Orient Telecoms

Risk-Adjusted Performance

Very Weak

Over the last 90 days Orient Telecoms has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Orient Telecoms is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

River and Mercantile

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in River and Mercantile are ranked lower than 32 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, River unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Orient Telecoms and River

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

The idea behind Orient Telecoms and River and Mercantile 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.