Correlation Between Bombay Burmah and Jindal Poly
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By analyzing existing cross correlation between Bombay Burmah Trading and Jindal Poly Investment, you can compare the effects of market volatilities on Bombay Burmah and Jindal Poly 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 Bombay Burmah with a short position of Jindal Poly. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bombay Burmah and Jindal Poly.
Diversification Opportunities for Bombay Burmah and Jindal Poly
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Bombay and Jindal is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Bombay Burmah Trading and Jindal Poly Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jindal Poly Investment and Bombay Burmah 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 Bombay Burmah Trading are associated (or correlated) with Jindal Poly. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jindal Poly Investment has no effect on the direction of Bombay Burmah i.e., Bombay Burmah and Jindal Poly go up and down completely randomly.
Pair Corralation between Bombay Burmah and Jindal Poly
Assuming the 90 days trading horizon Bombay Burmah Trading is expected to under-perform the Jindal Poly. But the stock apears to be less risky and, when comparing its historical volatility, Bombay Burmah Trading is 1.19 times less risky than Jindal Poly. The stock trades about -0.29 of its potential returns per unit of risk. The Jindal Poly Investment is currently generating about -0.18 of returns per unit of risk over similar time horizon. If you would invest 70,735 in Jindal Poly Investment on December 13, 2024 and sell it today you would lose (8,120) from holding Jindal Poly Investment or give up 11.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Bombay Burmah Trading vs. Jindal Poly Investment
Performance |
| Timeline |
| Bombay Burmah Trading |
| Jindal Poly Investment |
Bombay Burmah and Jindal Poly Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bombay Burmah and Jindal Poly
The main advantage of trading using opposite Bombay Burmah and Jindal Poly positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bombay Burmah position performs unexpectedly, Jindal Poly 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 Jindal Poly will offset losses from the drop in Jindal Poly's long position.| Bombay Burmah vs. Mangalore Chemicals Fertilizers | ||
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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 Stocks Directory module to find actively traded stocks across global markets.
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