Correlation Between Can Fin and Iris Clothings
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By analyzing existing cross correlation between Can Fin Homes and Iris Clothings Limited, you can compare the effects of market volatilities on Can Fin and Iris Clothings 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 Iris Clothings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Can Fin and Iris Clothings.
Diversification Opportunities for Can Fin and Iris Clothings
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Can and Iris is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Can Fin Homes and Iris Clothings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iris Clothings 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 Iris Clothings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iris Clothings has no effect on the direction of Can Fin i.e., Can Fin and Iris Clothings go up and down completely randomly.
Pair Corralation between Can Fin and Iris Clothings
Assuming the 90 days trading horizon Can Fin Homes is expected to under-perform the Iris Clothings. But the stock apears to be less risky and, when comparing its historical volatility, Can Fin Homes is 2.03 times less risky than Iris Clothings. The stock trades about -0.23 of its potential returns per unit of risk. The Iris Clothings Limited is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 6,581 in Iris Clothings Limited on September 1, 2024 and sell it today you would lose (213.00) from holding Iris Clothings Limited or give up 3.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Can Fin Homes vs. Iris Clothings Limited
Performance |
| Timeline |
| Can Fin Homes |
| Iris Clothings |
Can Fin and Iris Clothings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Can Fin and Iris Clothings
The main advantage of trading using opposite Can Fin and Iris Clothings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Can Fin position performs unexpectedly, Iris Clothings 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 Iris Clothings will offset losses from the drop in Iris Clothings' long position.| Can Fin vs. Lemon Tree Hotels | Can Fin vs. Manaksia Coated Metals | Can Fin vs. EIH Associated Hotels | Can Fin vs. Action Construction Equipment |
| Iris Clothings vs. MSP Steel Power | Iris Clothings vs. Hisar Metal Industries | Iris Clothings vs. JSW Steel Limited | Iris Clothings vs. Kalyani Steels 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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