Correlation Between BF Utilities and Home First
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By analyzing existing cross correlation between BF Utilities Limited and Home First Finance, you can compare the effects of market volatilities on BF Utilities and Home First 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 Utilities with a short position of Home First. Check out your portfolio center. Please also check ongoing floating volatility patterns of BF Utilities and Home First.
Diversification Opportunities for BF Utilities and Home First
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between BFUTILITIE and Home is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding BF Utilities Limited and Home First Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Home First Finance and BF Utilities 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 Utilities Limited are associated (or correlated) with Home First. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Home First Finance has no effect on the direction of BF Utilities i.e., BF Utilities and Home First go up and down completely randomly.
Pair Corralation between BF Utilities and Home First
Assuming the 90 days trading horizon BF Utilities Limited is expected to generate 0.83 times more return on investment than Home First. However, BF Utilities Limited is 1.2 times less risky than Home First. It trades about 0.38 of its potential returns per unit of risk. Home First Finance is currently generating about -0.23 per unit of risk. If you would invest 85,115 in BF Utilities Limited on September 1, 2024 and sell it today you would earn a total of 13,500 from holding BF Utilities Limited or generate 15.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BF Utilities Limited vs. Home First Finance
Performance |
| Timeline |
| BF Utilities Limited |
| Home First Finance |
BF Utilities and Home First Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BF Utilities and Home First
The main advantage of trading using opposite BF Utilities and Home First positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BF Utilities position performs unexpectedly, Home First 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 Home First will offset losses from the drop in Home First's long position.| BF Utilities vs. Spencers Retail Limited | BF Utilities vs. Shree Pushkar Chemicals | BF Utilities vs. Indraprastha Medical | BF Utilities vs. Vishnu Chemicals Limited |
| Home First vs. Bharat Road Network | Home First vs. Paramount Communications Limited | Home First vs. Hi Tech Pipes Limited | Home First vs. Golden Tobacco 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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