Correlation Between Bombay Burmah and POWERGRID Infrastructure

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Bombay Burmah and POWERGRID Infrastructure 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 Bombay Burmah and POWERGRID Infrastructure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bombay Burmah Trading and POWERGRID Infrastructure Investment, you can compare the effects of market volatilities on Bombay Burmah and POWERGRID Infrastructure 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 POWERGRID Infrastructure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bombay Burmah and POWERGRID Infrastructure.

Diversification Opportunities for Bombay Burmah and POWERGRID Infrastructure

BombayPOWERGRIDDiversified AwayBombayPOWERGRIDDiversified Away100%
0.88
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Bombay and POWERGRID is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Bombay Burmah Trading and POWERGRID Infrastructure Inves in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on POWERGRID Infrastructure 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 POWERGRID Infrastructure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of POWERGRID Infrastructure has no effect on the direction of Bombay Burmah i.e., Bombay Burmah and POWERGRID Infrastructure go up and down completely randomly.

Pair Corralation between Bombay Burmah and POWERGRID Infrastructure

Assuming the 90 days trading horizon Bombay Burmah Trading is expected to under-perform the POWERGRID Infrastructure. In addition to that, Bombay Burmah is 3.72 times more volatile than POWERGRID Infrastructure Investment. It trades about -0.29 of its total potential returns per unit of risk. POWERGRID Infrastructure Investment is currently generating about -0.55 per unit of volatility. If you would invest  8,170  in POWERGRID Infrastructure Investment on December 13, 2024 and sell it today you would lose (585.00) from holding POWERGRID Infrastructure Investment or give up 7.16% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Bombay Burmah Trading  vs.  POWERGRID Infrastructure Inves

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -30-25-20-15-10-50
JavaScript chart by amCharts 3.21.15BBTC PGINVIT-IV
       Timeline  
Bombay Burmah Trading 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Bombay Burmah Trading has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady 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.
JavaScript chart by amCharts 3.21.15JanFebMarFebMar1,6001,7001,8001,9002,0002,1002,2002,3002,400
POWERGRID Infrastructure 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days POWERGRID Infrastructure Investment 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 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.
JavaScript chart by amCharts 3.21.15JanFebMarFebMar76788082848688

Bombay Burmah and POWERGRID Infrastructure Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-4.7-3.52-2.34-1.16-0.01670.981.982.983.98 0.10.20.30.40.5
JavaScript chart by amCharts 3.21.15BBTC PGINVIT-IV
       Returns  

Pair Trading with Bombay Burmah and POWERGRID Infrastructure

The main advantage of trading using opposite Bombay Burmah and POWERGRID Infrastructure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bombay Burmah position performs unexpectedly, POWERGRID Infrastructure 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 POWERGRID Infrastructure will offset losses from the drop in POWERGRID Infrastructure's long position.
Bombay Burmah vs. Mangalore Chemicals Fertilizers
Bombay Burmah vs. Bodal Chemicals Limited
Bombay Burmah vs. Hexa Tradex Limited
Bombay Burmah vs. Gujarat Fluorochemicals Limited
The idea behind Bombay Burmah Trading and POWERGRID Infrastructure Investment 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.
POWERGRID Infrastructure vs. Repco Home Finance
POWERGRID Infrastructure vs. Industrial Investment Trust
POWERGRID Infrastructure vs. Sarthak Metals Limited
POWERGRID Infrastructure vs. Man Infraconstruction Limited
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.

Other Complementary Tools

Investing Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
Top Crypto Exchanges
Search and analyze digital assets across top global cryptocurrency exchanges
Stock Screener
Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook.
Balance Of Power
Check stock momentum by analyzing Balance Of Power indicator and other technical ratios
Theme Ratings
Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance


 
Macroaxis helps investors of all levels and skills to maximize the upside of all their holdings and minimize the risk associated with market volatility, economic swings, and company-specific events. View terms and conditions
 
Feedback Blog
Made with optimal in San Francisco
2024 Macroaxis LLC
COMMON DESTINATIONS
MAIN CATEGORIES
COMPANY