Correlation Between Bajaj Finance and SBI Cards
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By analyzing existing cross correlation between Bajaj Finance Limited and SBI Cards and, you can compare the effects of market volatilities on Bajaj Finance and SBI Cards 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 Bajaj Finance with a short position of SBI Cards. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bajaj Finance and SBI Cards.
Diversification Opportunities for Bajaj Finance and SBI Cards
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bajaj and SBI is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Bajaj Finance Limited and SBI Cards and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SBI Cards and Bajaj Finance 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 Bajaj Finance Limited are associated (or correlated) with SBI Cards. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SBI Cards has no effect on the direction of Bajaj Finance i.e., Bajaj Finance and SBI Cards go up and down completely randomly.
Pair Corralation between Bajaj Finance and SBI Cards
Assuming the 90 days trading horizon Bajaj Finance Limited is expected to under-perform the SBI Cards. In addition to that, Bajaj Finance is 1.37 times more volatile than SBI Cards and. It trades about -0.16 of its total potential returns per unit of risk. SBI Cards and is currently generating about 0.04 per unit of volatility. If you would invest 69,480 in SBI Cards and on September 2, 2024 and sell it today you would earn a total of 580.00 from holding SBI Cards and or generate 0.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Bajaj Finance Limited vs. SBI Cards and
Performance |
| Timeline |
| Bajaj Finance Limited |
| SBI Cards |
Bajaj Finance and SBI Cards Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bajaj Finance and SBI Cards
The main advantage of trading using opposite Bajaj Finance and SBI Cards positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bajaj Finance position performs unexpectedly, SBI Cards 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 SBI Cards will offset losses from the drop in SBI Cards' long position.| Bajaj Finance vs. NMDC Steel Limited | Bajaj Finance vs. Univa Foods Limited | Bajaj Finance vs. ADF Foods Limited | Bajaj Finance vs. Vraj Iron and |
| SBI Cards vs. Advani Hotels Resorts | SBI Cards vs. Reliance Home Finance | SBI Cards vs. Chalet Hotels Limited | SBI Cards vs. EIH Associated Hotels |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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