Correlation Between BF Utilities and Salzer Electronics
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By analyzing existing cross correlation between BF Utilities Limited and Salzer Electronics Limited, you can compare the effects of market volatilities on BF Utilities and Salzer Electronics 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 Salzer Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of BF Utilities and Salzer Electronics.
Diversification Opportunities for BF Utilities and Salzer Electronics
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BFUTILITIE and Salzer is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding BF Utilities Limited and Salzer Electronics Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salzer Electronics 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 Salzer Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salzer Electronics has no effect on the direction of BF Utilities i.e., BF Utilities and Salzer Electronics go up and down completely randomly.
Pair Corralation between BF Utilities and Salzer Electronics
Assuming the 90 days trading horizon BF Utilities Limited is expected to generate 0.72 times more return on investment than Salzer Electronics. However, BF Utilities Limited is 1.38 times less risky than Salzer Electronics. It trades about 0.38 of its potential returns per unit of risk. Salzer Electronics Limited is currently generating about 0.1 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 | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BF Utilities Limited vs. Salzer Electronics Limited
Performance |
| Timeline |
| BF Utilities Limited |
| Salzer Electronics |
BF Utilities and Salzer Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BF Utilities and Salzer Electronics
The main advantage of trading using opposite BF Utilities and Salzer Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BF Utilities position performs unexpectedly, Salzer Electronics 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 Salzer Electronics will offset losses from the drop in Salzer Electronics' 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 |
| Salzer Electronics vs. Modi Rubber Limited | Salzer Electronics vs. Gokul Refoils and | Salzer Electronics vs. Shyam Metalics and | Salzer Electronics vs. Sarthak Metals 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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