Correlation Between Can Fin and Indian Railway
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By analyzing existing cross correlation between Can Fin Homes and Indian Railway Finance, you can compare the effects of market volatilities on Can Fin and Indian Railway 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 Can Fin with a short position of Indian Railway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Can Fin and Indian Railway.
Diversification Opportunities for Can Fin and Indian Railway
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Can and Indian is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Can Fin Homes and Indian Railway Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indian Railway Finance and Can Fin 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 Can Fin Homes are associated (or correlated) with Indian Railway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indian Railway Finance has no effect on the direction of Can Fin i.e., Can Fin and Indian Railway go up and down completely randomly.
Pair Corralation between Can Fin and Indian Railway
Assuming the 90 days trading horizon Can Fin is expected to generate 3.45 times less return on investment than Indian Railway. But when comparing it to its historical volatility, Can Fin Homes is 1.68 times less risky than Indian Railway. It trades about 0.06 of its potential returns per unit of risk. Indian Railway Finance is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 2,993 in Indian Railway Finance on September 14, 2024 and sell it today you would earn a total of 13,280 from holding Indian Railway Finance or generate 443.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.59% |
| Values | Daily Returns |
Can Fin Homes vs. Indian Railway Finance
Performance |
| Timeline |
| Can Fin Homes |
| Indian Railway Finance |
Can Fin and Indian Railway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Can Fin and Indian Railway
The main advantage of trading using opposite Can Fin and Indian Railway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Can Fin position performs unexpectedly, Indian Railway 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 Indian Railway will offset losses from the drop in Indian Railway's long position.| Can Fin vs. Bodhi Tree Multimedia | Can Fin vs. Next Mediaworks Limited | Can Fin vs. Indo Borax Chemicals | Can Fin vs. Hindcon Chemicals Limited |
| Indian Railway vs. Can Fin Homes | Indian Railway vs. EMBASSY OFFICE PARKS | Indian Railway vs. Himadri Speciality Chemical | Indian Railway vs. Next Mediaworks 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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