Correlation Between Ankit Metal and Infosys

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Can any of the company-specific risk be diversified away by investing in both Ankit Metal and Infosys 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 Ankit Metal and Infosys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ankit Metal Power and Infosys Limited, you can compare the effects of market volatilities on Ankit Metal and Infosys 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 Ankit Metal with a short position of Infosys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ankit Metal and Infosys.

Diversification Opportunities for Ankit Metal and Infosys

0.73
  Correlation Coefficient

Poor diversification

The 3 months correlation between Ankit and Infosys is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Ankit Metal Power and Infosys Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infosys Limited and Ankit Metal 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 Ankit Metal Power are associated (or correlated) with Infosys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infosys Limited has no effect on the direction of Ankit Metal i.e., Ankit Metal and Infosys go up and down completely randomly.

Pair Corralation between Ankit Metal and Infosys

Assuming the 90 days trading horizon Ankit Metal Power is expected to under-perform the Infosys. In addition to that, Ankit Metal is 3.11 times more volatile than Infosys Limited. It trades about -0.12 of its total potential returns per unit of risk. Infosys Limited is currently generating about -0.35 per unit of volatility. If you would invest  188,000  in Infosys Limited on December 11, 2024 and sell it today you would lose (17,855) from holding Infosys Limited or give up 9.5% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Ankit Metal Power  vs.  Infosys Limited

 Performance 
       Timeline  
Ankit Metal Power 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Ankit Metal Power has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.
Infosys Limited 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Infosys Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Ankit Metal and Infosys Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Ankit Metal and Infosys

The main advantage of trading using opposite Ankit Metal and Infosys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ankit Metal position performs unexpectedly, Infosys 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 Infosys will offset losses from the drop in Infosys' long position.
The idea behind Ankit Metal Power and Infosys Limited 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.

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