Correlation Between BF Investment and Indian Metals
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By analyzing existing cross correlation between BF Investment Limited and Indian Metals Ferro, you can compare the effects of market volatilities on BF Investment and Indian Metals 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 BF Investment with a short position of Indian Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of BF Investment and Indian Metals.
Diversification Opportunities for BF Investment and Indian Metals
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between BFINVEST and Indian is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding BF Investment Limited and Indian Metals Ferro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indian Metals Ferro and BF Investment 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 BF Investment Limited are associated (or correlated) with Indian Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indian Metals Ferro has no effect on the direction of BF Investment i.e., BF Investment and Indian Metals go up and down completely randomly.
Pair Corralation between BF Investment and Indian Metals
Assuming the 90 days trading horizon BF Investment Limited is expected to under-perform the Indian Metals. In addition to that, BF Investment is 1.1 times more volatile than Indian Metals Ferro. It trades about -0.35 of its total potential returns per unit of risk. Indian Metals Ferro is currently generating about -0.03 per unit of volatility. If you would invest 87,105 in Indian Metals Ferro on October 25, 2024 and sell it today you would lose (2,220) from holding Indian Metals Ferro or give up 2.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
BF Investment Limited vs. Indian Metals Ferro
Performance |
| Timeline |
| BF Investment Limited |
| Indian Metals Ferro |
BF Investment and Indian Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BF Investment and Indian Metals
The main advantage of trading using opposite BF Investment and Indian Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BF Investment position performs unexpectedly, Indian Metals 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 Indian Metals will offset losses from the drop in Indian Metals' long position.| BF Investment vs. State Bank of | BF Investment vs. Life Insurance | BF Investment vs. HDFC Bank Limited | BF Investment vs. ICICI Bank Limited |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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