Correlation Between Central Bank and Selan Exploration
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By analyzing existing cross correlation between Central Bank of and Selan Exploration Technology, you can compare the effects of market volatilities on Central Bank and Selan Exploration 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 Central Bank with a short position of Selan Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Central Bank and Selan Exploration.
Diversification Opportunities for Central Bank and Selan Exploration
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Central and Selan is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Central Bank of and Selan Exploration Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Selan Exploration and Central Bank 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 Central Bank of are associated (or correlated) with Selan Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Selan Exploration has no effect on the direction of Central Bank i.e., Central Bank and Selan Exploration go up and down completely randomly.
Pair Corralation between Central Bank and Selan Exploration
Assuming the 90 days trading horizon Central Bank of is expected to generate 0.96 times more return on investment than Selan Exploration. However, Central Bank of is 1.04 times less risky than Selan Exploration. It trades about -0.04 of its potential returns per unit of risk. Selan Exploration Technology is currently generating about -0.08 per unit of risk. If you would invest 6,069 in Central Bank of on November 2, 2024 and sell it today you would lose (962.00) from holding Central Bank of or give up 15.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Central Bank of vs. Selan Exploration Technology
Performance |
| Timeline |
| Central Bank |
| Selan Exploration |
Central Bank and Selan Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Central Bank and Selan Exploration
The main advantage of trading using opposite Central Bank and Selan Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Central Bank position performs unexpectedly, Selan Exploration 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 Selan Exploration will offset losses from the drop in Selan Exploration's long position.| Central Bank vs. Diligent Media | Central Bank vs. HT Media Limited | Central Bank vs. Bharatiya Global Infomedia | Central Bank vs. Hisar Metal Industries |
| Selan Exploration vs. Tamilnadu Telecommunication Limited | Selan Exploration vs. Ortel Communications Limited | Selan Exploration vs. Praxis Home Retail | Selan Exploration vs. Cantabil Retail India |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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