Correlation Between Bandhan Bank and ICICI Bank
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By analyzing existing cross correlation between Bandhan Bank Limited and ICICI Bank Limited, you can compare the effects of market volatilities on Bandhan Bank and ICICI Bank 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 Bandhan Bank with a short position of ICICI Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bandhan Bank and ICICI Bank.
Diversification Opportunities for Bandhan Bank and ICICI Bank
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bandhan and ICICI is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Bandhan Bank Limited and ICICI Bank Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICICI Bank Limited and Bandhan Bank 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 Bandhan Bank Limited are associated (or correlated) with ICICI Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ICICI Bank Limited has no effect on the direction of Bandhan Bank i.e., Bandhan Bank and ICICI Bank go up and down completely randomly.
Pair Corralation between Bandhan Bank and ICICI Bank
Assuming the 90 days trading horizon Bandhan Bank Limited is expected to under-perform the ICICI Bank. In addition to that, Bandhan Bank is 2.0 times more volatile than ICICI Bank Limited. It trades about 0.0 of its total potential returns per unit of risk. ICICI Bank Limited is currently generating about 0.09 per unit of volatility. If you would invest 107,767 in ICICI Bank Limited on September 3, 2024 and sell it today you would earn a total of 22,243 from holding ICICI Bank Limited or generate 20.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.39% |
| Values | Daily Returns |
Bandhan Bank Limited vs. ICICI Bank Limited
Performance |
| Timeline |
| Bandhan Bank Limited |
| ICICI Bank Limited |
Bandhan Bank and ICICI Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bandhan Bank and ICICI Bank
The main advantage of trading using opposite Bandhan Bank and ICICI Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bandhan Bank position performs unexpectedly, ICICI Bank 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 ICICI Bank will offset losses from the drop in ICICI Bank's long position.| Bandhan Bank vs. Reliance Industries Limited | Bandhan Bank vs. Shipping | Bandhan Bank vs. Indo Borax Chemicals | Bandhan Bank vs. Kingfa Science Technology |
| ICICI Bank vs. Reliance Industries Limited | ICICI Bank vs. Shipping | ICICI Bank vs. Indo Borax Chemicals | ICICI Bank vs. Kingfa Science Technology |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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