Correlation Between Blue Coast and Prakash Steelage
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By analyzing existing cross correlation between Blue Coast Hotels and Prakash Steelage Limited, you can compare the effects of market volatilities on Blue Coast and Prakash Steelage 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 Blue Coast with a short position of Prakash Steelage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Coast and Prakash Steelage.
Diversification Opportunities for Blue Coast and Prakash Steelage
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Blue and Prakash is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Blue Coast Hotels and Prakash Steelage Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prakash Steelage and Blue Coast 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 Blue Coast Hotels are associated (or correlated) with Prakash Steelage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prakash Steelage has no effect on the direction of Blue Coast i.e., Blue Coast and Prakash Steelage go up and down completely randomly.
Pair Corralation between Blue Coast and Prakash Steelage
Assuming the 90 days trading horizon Blue Coast Hotels is expected to generate 1.39 times more return on investment than Prakash Steelage. However, Blue Coast is 1.39 times more volatile than Prakash Steelage Limited. It trades about 0.71 of its potential returns per unit of risk. Prakash Steelage Limited is currently generating about -0.08 per unit of risk. If you would invest 998.00 in Blue Coast Hotels on October 30, 2024 and sell it today you would earn a total of 1,745 from holding Blue Coast Hotels or generate 174.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blue Coast Hotels vs. Prakash Steelage Limited
Performance |
| Timeline |
| Blue Coast Hotels |
| Prakash Steelage |
Blue Coast and Prakash Steelage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blue Coast and Prakash Steelage
The main advantage of trading using opposite Blue Coast and Prakash Steelage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Coast position performs unexpectedly, Prakash Steelage 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 Prakash Steelage will offset losses from the drop in Prakash Steelage's long position.| Blue Coast vs. Medplus Health Services | Blue Coast vs. Country Club Hospitality | Blue Coast vs. Teamlease Services Limited | Blue Coast vs. Zota Health Care |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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