Correlation Between ADF Foods and Kohinoor Foods
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By analyzing existing cross correlation between ADF Foods Limited and Kohinoor Foods Limited, you can compare the effects of market volatilities on ADF Foods and Kohinoor Foods 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 ADF Foods with a short position of Kohinoor Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of ADF Foods and Kohinoor Foods.
Diversification Opportunities for ADF Foods and Kohinoor Foods
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ADF and Kohinoor is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding ADF Foods Limited and Kohinoor Foods Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kohinoor Foods and ADF Foods 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 ADF Foods Limited are associated (or correlated) with Kohinoor Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kohinoor Foods has no effect on the direction of ADF Foods i.e., ADF Foods and Kohinoor Foods go up and down completely randomly.
Pair Corralation between ADF Foods and Kohinoor Foods
Assuming the 90 days trading horizon ADF Foods Limited is expected to generate 1.92 times more return on investment than Kohinoor Foods. However, ADF Foods is 1.92 times more volatile than Kohinoor Foods Limited. It trades about -0.06 of its potential returns per unit of risk. Kohinoor Foods Limited is currently generating about -0.23 per unit of risk. If you would invest 25,255 in ADF Foods Limited on November 28, 2024 and sell it today you would lose (1,355) from holding ADF Foods Limited or give up 5.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ADF Foods Limited vs. Kohinoor Foods Limited
Performance |
| Timeline |
| ADF Foods Limited |
| Kohinoor Foods |
ADF Foods and Kohinoor Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ADF Foods and Kohinoor Foods
The main advantage of trading using opposite ADF Foods and Kohinoor Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ADF Foods position performs unexpectedly, Kohinoor Foods 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 Kohinoor Foods will offset losses from the drop in Kohinoor Foods' long position.| ADF Foods vs. Bikaji Foods International | ADF Foods vs. EMBASSY OFFICE PARKS | ADF Foods vs. Kamat Hotels Limited | ADF Foods vs. Juniper Hotels |
| Kohinoor Foods vs. Advani Hotels Resorts | Kohinoor Foods vs. ITCHOTELS | Kohinoor Foods vs. MIRC Electronics Limited | Kohinoor Foods vs. Electronics Mart India |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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