Correlation Between Bikaji Foods and Selan Exploration
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By analyzing existing cross correlation between Bikaji Foods International and Selan Exploration Technology, you can compare the effects of market volatilities on Bikaji Foods and Selan Exploration 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 Bikaji Foods with a short position of Selan Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bikaji Foods and Selan Exploration.
Diversification Opportunities for Bikaji Foods and Selan Exploration
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bikaji and Selan is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Bikaji Foods International and Selan Exploration Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Selan Exploration and Bikaji Foods 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 Bikaji Foods International are associated (or correlated) with Selan Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Selan Exploration has no effect on the direction of Bikaji Foods i.e., Bikaji Foods and Selan Exploration go up and down completely randomly.
Pair Corralation between Bikaji Foods and Selan Exploration
Assuming the 90 days trading horizon Bikaji Foods is expected to generate 1.32 times less return on investment than Selan Exploration. But when comparing it to its historical volatility, Bikaji Foods International is 1.51 times less risky than Selan Exploration. It trades about 0.07 of its potential returns per unit of risk. Selan Exploration Technology is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 26,495 in Selan Exploration Technology on November 27, 2024 and sell it today you would earn a total of 26,800 from holding Selan Exploration Technology or generate 101.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bikaji Foods International vs. Selan Exploration Technology
Performance |
| Timeline |
| Bikaji Foods Interna |
| Selan Exploration |
Bikaji Foods and Selan Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bikaji Foods and Selan Exploration
The main advantage of trading using opposite Bikaji Foods and Selan Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bikaji Foods position performs unexpectedly, Selan Exploration 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 Selan Exploration will offset losses from the drop in Selan Exploration's long position.| Bikaji Foods vs. Foods Inns Limited | Bikaji Foods vs. ZF Commercial Vehicle | Bikaji Foods vs. Hindustan Foods Limited | Bikaji Foods vs. Home First Finance |
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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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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