Correlation Between Bodhi Tree and Sonata Software
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By analyzing existing cross correlation between Bodhi Tree Multimedia and Sonata Software Limited, you can compare the effects of market volatilities on Bodhi Tree and Sonata Software 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 Bodhi Tree with a short position of Sonata Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bodhi Tree and Sonata Software.
Diversification Opportunities for Bodhi Tree and Sonata Software
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bodhi and Sonata is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Bodhi Tree Multimedia and Sonata Software Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sonata Software and Bodhi Tree 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 Bodhi Tree Multimedia are associated (or correlated) with Sonata Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sonata Software has no effect on the direction of Bodhi Tree i.e., Bodhi Tree and Sonata Software go up and down completely randomly.
Pair Corralation between Bodhi Tree and Sonata Software
Assuming the 90 days trading horizon Bodhi Tree Multimedia is expected to generate 9.47 times more return on investment than Sonata Software. However, Bodhi Tree is 9.47 times more volatile than Sonata Software Limited. It trades about 0.07 of its potential returns per unit of risk. Sonata Software Limited is currently generating about 0.05 per unit of risk. If you would invest 1,545 in Bodhi Tree Multimedia on October 30, 2024 and sell it today you would lose (455.00) from holding Bodhi Tree Multimedia or give up 29.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bodhi Tree Multimedia vs. Sonata Software Limited
Performance |
| Timeline |
| Bodhi Tree Multimedia |
| Sonata Software |
Bodhi Tree and Sonata Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bodhi Tree and Sonata Software
The main advantage of trading using opposite Bodhi Tree and Sonata Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bodhi Tree position performs unexpectedly, Sonata Software 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 Sonata Software will offset losses from the drop in Sonata Software's long position.| Bodhi Tree vs. Shaily Engineering Plastics | Bodhi Tree vs. General Insurance | Bodhi Tree vs. CREDITACCESS GRAMEEN LIMITED | Bodhi Tree vs. Hybrid Financial Services |
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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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