Correlation Between Can Fin and Pondy Oxides
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By analyzing existing cross correlation between Can Fin Homes and Pondy Oxides Chemicals, you can compare the effects of market volatilities on Can Fin and Pondy Oxides 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 Pondy Oxides. Check out your portfolio center. Please also check ongoing floating volatility patterns of Can Fin and Pondy Oxides.
Diversification Opportunities for Can Fin and Pondy Oxides
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Can and Pondy is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Can Fin Homes and Pondy Oxides Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pondy Oxides Chemicals 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 Pondy Oxides. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pondy Oxides Chemicals has no effect on the direction of Can Fin i.e., Can Fin and Pondy Oxides go up and down completely randomly.
Pair Corralation between Can Fin and Pondy Oxides
Assuming the 90 days trading horizon Can Fin Homes is expected to generate 0.48 times more return on investment than Pondy Oxides. However, Can Fin Homes is 2.07 times less risky than Pondy Oxides. It trades about -0.11 of its potential returns per unit of risk. Pondy Oxides Chemicals is currently generating about -0.06 per unit of risk. If you would invest 90,100 in Can Fin Homes on August 30, 2024 and sell it today you would lose (7,475) from holding Can Fin Homes or give up 8.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.62% |
| Values | Daily Returns |
Can Fin Homes vs. Pondy Oxides Chemicals
Performance |
| Timeline |
| Can Fin Homes |
| Pondy Oxides Chemicals |
Can Fin and Pondy Oxides Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Can Fin and Pondy Oxides
The main advantage of trading using opposite Can Fin and Pondy Oxides positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Can Fin position performs unexpectedly, Pondy Oxides 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 Pondy Oxides will offset losses from the drop in Pondy Oxides' long position.| Can Fin vs. MRF Limited | Can Fin vs. Bosch Limited | Can Fin vs. Bajaj Holdings Investment | Can Fin vs. Vardhman Holdings Limited |
| Pondy Oxides vs. Steel Authority of | Pondy Oxides vs. Embassy Office Parks | Pondy Oxides vs. Indian Metals Ferro | Pondy Oxides vs. JTL Industries |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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