Correlation Between BF Investment and JSW Steel
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By analyzing existing cross correlation between BF Investment Limited and JSW Steel Limited, you can compare the effects of market volatilities on BF Investment and JSW Steel 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 JSW Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of BF Investment and JSW Steel.
Diversification Opportunities for BF Investment and JSW Steel
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BFINVEST and JSW is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding BF Investment Limited and JSW Steel Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JSW Steel Limited 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 JSW Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JSW Steel Limited has no effect on the direction of BF Investment i.e., BF Investment and JSW Steel go up and down completely randomly.
Pair Corralation between BF Investment and JSW Steel
Assuming the 90 days trading horizon BF Investment Limited is expected to under-perform the JSW Steel. In addition to that, BF Investment is 2.41 times more volatile than JSW Steel Limited. It trades about -0.2 of its total potential returns per unit of risk. JSW Steel Limited is currently generating about 0.2 per unit of volatility. If you would invest 90,090 in JSW Steel Limited on November 7, 2024 and sell it today you would earn a total of 4,410 from holding JSW Steel Limited or generate 4.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
BF Investment Limited vs. JSW Steel Limited
Performance |
| Timeline |
| BF Investment Limited |
| JSW Steel Limited |
BF Investment and JSW Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BF Investment and JSW Steel
The main advantage of trading using opposite BF Investment and JSW Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BF Investment position performs unexpectedly, JSW Steel 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 JSW Steel will offset losses from the drop in JSW Steel's long position.| BF Investment vs. MRF Limited | BF Investment vs. The Orissa Minerals | BF Investment vs. Honeywell Automation India | BF Investment vs. Page Industries Limited |
| JSW Steel vs. Hybrid Financial Services | JSW Steel vs. Karur Vysya Bank | JSW Steel vs. Keynote Financial Services | JSW Steel vs. DCB Bank 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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