Correlation Between Interlink Telecom and Interlink Communication

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

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

Diversification Opportunities for Interlink Telecom and Interlink Communication

-0.27

Correlation Coefficient

Interlink Telecom  Interlink Communication

Very good diversification

The 3 months correlation between Interlink and Interlink is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Interlink Telecom Public and Interlink Communication Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Interlink Communication and Interlink Telecom 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 Interlink Telecom Public are associated (or correlated) with Interlink Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Interlink Communication has no effect on the direction of Interlink Telecom i.e., Interlink Telecom and Interlink Communication go up and down completely randomly.

Pair Corralation between Interlink Telecom and Interlink Communication

Assuming the 90 days trading horizon Interlink Telecom Public is expected to under-perform the Interlink Communication. In addition to that, Interlink Telecom is 4.0 times more volatile than Interlink Communication Public. It trades about -0.47 of its total potential returns per unit of risk. Interlink Communication Public is currently generating about -0.36 per unit of volatility. If you would invest  500.00  in Interlink Communication Public on July 19, 2025 and sell it today you would lose (22.00) from holding Interlink Communication Public or give up 4.4% of portfolio value over 90 days.

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

Interlink Telecom Public  vs.  Interlink Communication Public

Interlink Telecom Public

Risk-Adjusted Performance

Weakest

Over the last 90 days Interlink Telecom Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Interlink Telecom is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Interlink Communication

Risk-Adjusted Performance

Weakest

Over the last 90 days Interlink Communication Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's fundamental drivers remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Interlink Telecom and Interlink Communication

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

The idea behind Interlink Telecom Public and Interlink Communication Public 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.