Correlation Between Aban Offshore and Blue Coast
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By analyzing existing cross correlation between Aban Offshore Limited and Blue Coast Hotels, you can compare the effects of market volatilities on Aban Offshore and Blue Coast 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 Aban Offshore with a short position of Blue Coast. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aban Offshore and Blue Coast.
Diversification Opportunities for Aban Offshore and Blue Coast
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Aban and Blue is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Aban Offshore Limited and Blue Coast Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Coast Hotels and Aban Offshore 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 Aban Offshore Limited are associated (or correlated) with Blue Coast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Coast Hotels has no effect on the direction of Aban Offshore i.e., Aban Offshore and Blue Coast go up and down completely randomly.
Pair Corralation between Aban Offshore and Blue Coast
Assuming the 90 days trading horizon Aban Offshore Limited is expected to generate 1.95 times more return on investment than Blue Coast. However, Aban Offshore is 1.95 times more volatile than Blue Coast Hotels. It trades about 0.04 of its potential returns per unit of risk. Blue Coast Hotels is currently generating about 0.06 per unit of risk. If you would invest 5,990 in Aban Offshore Limited on September 3, 2024 and sell it today you would earn a total of 485.00 from holding Aban Offshore Limited or generate 8.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aban Offshore Limited vs. Blue Coast Hotels
Performance |
| Timeline |
| Aban Offshore Limited |
| Blue Coast Hotels |
Aban Offshore and Blue Coast Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aban Offshore and Blue Coast
The main advantage of trading using opposite Aban Offshore and Blue Coast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aban Offshore position performs unexpectedly, Blue Coast 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 Blue Coast will offset losses from the drop in Blue Coast's long position.| Aban Offshore vs. Manaksia Coated Metals | Aban Offshore vs. Global Education Limited | Aban Offshore vs. Indian Metals Ferro | Aban Offshore vs. Motilal Oswal Financial |
| Blue Coast vs. Repco Home Finance | Blue Coast vs. Manaksia Coated Metals | Blue Coast vs. Embassy Office Parks | Blue Coast vs. Teamlease Services Limited |
Check out your portfolio center.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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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