Correlation Between Agro Tech and Selan Exploration
Can any of the company-specific risk be diversified away by investing in both Agro Tech and Selan Exploration 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 Agro Tech and Selan Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agro Tech Foods and Selan Exploration Technology, you can compare the effects of market volatilities on Agro Tech and Selan Exploration 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 Agro Tech with a short position of Selan Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agro Tech and Selan Exploration.
Diversification Opportunities for Agro Tech and Selan Exploration
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Agro and Selan is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Agro Tech Foods and Selan Exploration Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Selan Exploration and Agro Tech 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 Agro Tech Foods are associated (or correlated) with Selan Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Selan Exploration has no effect on the direction of Agro Tech i.e., Agro Tech and Selan Exploration go up and down completely randomly.
Pair Corralation between Agro Tech and Selan Exploration
Assuming the 90 days trading horizon Agro Tech Foods is expected to generate 1.12 times more return on investment than Selan Exploration. However, Agro Tech is 1.12 times more volatile than Selan Exploration Technology. It trades about 0.07 of its potential returns per unit of risk. Selan Exploration Technology is currently generating about -0.03 per unit of risk. If you would invest 83,480 in Agro Tech Foods on September 2, 2024 and sell it today you would earn a total of 10,335 from holding Agro Tech Foods or generate 12.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agro Tech Foods vs. Selan Exploration Technology
Performance |
| Timeline |
| Agro Tech Foods |
| Selan Exploration |
Agro Tech and Selan Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agro Tech and Selan Exploration
The main advantage of trading using opposite Agro Tech and Selan Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agro Tech position performs unexpectedly, Selan Exploration 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 Selan Exploration will offset losses from the drop in Selan Exploration's long position.| Agro Tech vs. Steelcast Limited | Agro Tech vs. NMDC Steel Limited | Agro Tech vs. HDFC Life Insurance | Agro Tech vs. MSP Steel Power |
| Selan Exploration vs. Digjam Limited | Selan Exploration vs. Gujarat Raffia Industries | Selan Exploration vs. Kingfa Science Technology | Selan Exploration vs. Rico Auto Industries |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |