Correlation Between Centaur Media and Axis Bank
Can any of the company-specific risk be diversified away by investing in both Centaur Media and Axis Bank at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Centaur Media and Axis Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centaur Media and Axis Bank Ltd, you can compare the effects of market volatilities on Centaur Media and Axis Bank 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 Centaur Media with a short position of Axis Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centaur Media and Axis Bank.
Diversification Opportunities for Centaur Media and Axis Bank
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Centaur and Axis is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Centaur Media and Axis Bank Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axis Bank and Centaur Media 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 Centaur Media are associated (or correlated) with Axis Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axis Bank has no effect on the direction of Centaur Media i.e., Centaur Media and Axis Bank go up and down completely randomly.
Pair Corralation between Centaur Media and Axis Bank
Assuming the 90 days trading horizon Centaur Media is expected to under-perform the Axis Bank. In addition to that, Centaur Media is 1.7 times more volatile than Axis Bank Ltd. It trades about -0.02 of its total potential returns per unit of risk. Axis Bank Ltd is currently generating about 0.03 per unit of volatility. If you would invest 5,712 in Axis Bank Ltd on September 4, 2024 and sell it today you would earn a total of 1,008 from holding Axis Bank Ltd or generate 17.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Centaur Media vs. Axis Bank Ltd
Performance |
| Timeline |
| Centaur Media |
| Axis Bank |
Centaur Media and Axis Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centaur Media and Axis Bank
The main advantage of trading using opposite Centaur Media and Axis Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centaur Media position performs unexpectedly, Axis Bank 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 Axis Bank will offset losses from the drop in Axis Bank's long position.| Centaur Media vs. Quadrise Plc | Centaur Media vs. ImmuPharma PLC | Centaur Media vs. Intuitive Investments Group | Centaur Media vs. European Metals Holdings |
| Axis Bank vs. Vulcan Materials Co | Axis Bank vs. Coeur Mining | Axis Bank vs. McEwen Mining | Axis Bank vs. Atalaya Mining |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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