Correlation Between ADF Foods and Taj GVK
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By analyzing existing cross correlation between ADF Foods Limited and Taj GVK Hotels, you can compare the effects of market volatilities on ADF Foods and Taj GVK 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 Taj GVK. Check out your portfolio center. Please also check ongoing floating volatility patterns of ADF Foods and Taj GVK.
Diversification Opportunities for ADF Foods and Taj GVK
Average diversification
The 3 months correlation between ADF and Taj is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding ADF Foods Limited and Taj GVK Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taj GVK Hotels 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 Taj GVK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taj GVK Hotels has no effect on the direction of ADF Foods i.e., ADF Foods and Taj GVK go up and down completely randomly.
Pair Corralation between ADF Foods and Taj GVK
Assuming the 90 days trading horizon ADF Foods Limited is expected to generate 1.39 times more return on investment than Taj GVK. However, ADF Foods is 1.39 times more volatile than Taj GVK Hotels. It trades about 0.13 of its potential returns per unit of risk. Taj GVK Hotels is currently generating about 0.03 per unit of risk. If you would invest 21,237 in ADF Foods Limited on September 1, 2024 and sell it today you would earn a total of 12,028 from holding ADF Foods Limited or generate 56.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ADF Foods Limited vs. Taj GVK Hotels
Performance |
| Timeline |
| ADF Foods Limited |
| Taj GVK Hotels |
ADF Foods and Taj GVK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ADF Foods and Taj GVK
The main advantage of trading using opposite ADF Foods and Taj GVK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ADF Foods position performs unexpectedly, Taj GVK 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 Taj GVK will offset losses from the drop in Taj GVK's long position.| ADF Foods vs. Kingfa Science Technology | ADF Foods vs. Rico Auto Industries | ADF Foods vs. GACM Technologies Limited | ADF Foods vs. COSMO FIRST LIMITED |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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