Correlation Between Electronics Mart and Datamatics Global

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

By analyzing existing cross correlation between Electronics Mart India and Datamatics Global Services, you can compare the effects of market volatilities on Electronics Mart and Datamatics Global 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 Electronics Mart with a short position of Datamatics Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electronics Mart and Datamatics Global.

Diversification Opportunities for Electronics Mart and Datamatics Global

-0.38

Correlation Coefficient

Electronics Mart  Datamatics Global

Very good diversification

The 3 months correlation between Electronics and Datamatics is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Electronics Mart India and Datamatics Global Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Datamatics Global and Electronics Mart 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 Electronics Mart India are associated (or correlated) with Datamatics Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Datamatics Global has no effect on the direction of Electronics Mart i.e., Electronics Mart and Datamatics Global go up and down completely randomly.

Pair Corralation between Electronics Mart and Datamatics Global

Assuming the 90 days trading horizon Electronics Mart India is expected to under-perform the Datamatics Global. In addition to that, Electronics Mart is 1.12 times more volatile than Datamatics Global Services. It trades about -0.03 of its total potential returns per unit of risk. Datamatics Global Services is currently generating about 0.3 per unit of volatility. If you would invest  61,675  in Datamatics Global Services on May 16, 2025 and sell it today you would earn a total of  38,645  from holding Datamatics Global Services or generate 62.66% return on investment over 90 days.

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

Electronics Mart India  vs.  Datamatics Global Services

Electronics Mart India

Risk-Adjusted Performance

Weakest

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

Datamatics Global

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Datamatics Global Services are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak forward indicators, Datamatics Global unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Electronics Mart and Datamatics Global

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

The idea behind Electronics Mart India and Datamatics Global Services 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.