Correlation Between Centum Electronics and Hexa Tradex
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By analyzing existing cross correlation between Centum Electronics Limited and Hexa Tradex Limited, you can compare the effects of market volatilities on Centum Electronics and Hexa Tradex 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 Centum Electronics with a short position of Hexa Tradex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centum Electronics and Hexa Tradex.
Diversification Opportunities for Centum Electronics and Hexa Tradex
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Centum and Hexa is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Centum Electronics Limited and Hexa Tradex Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hexa Tradex Limited and Centum Electronics 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 Centum Electronics Limited are associated (or correlated) with Hexa Tradex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hexa Tradex Limited has no effect on the direction of Centum Electronics i.e., Centum Electronics and Hexa Tradex go up and down completely randomly.
Pair Corralation between Centum Electronics and Hexa Tradex
Assuming the 90 days trading horizon Centum Electronics Limited is expected to generate 2.76 times more return on investment than Hexa Tradex. However, Centum Electronics is 2.76 times more volatile than Hexa Tradex Limited. It trades about 0.17 of its potential returns per unit of risk. Hexa Tradex Limited is currently generating about -0.41 per unit of risk. If you would invest 166,315 in Centum Electronics Limited on October 12, 2024 and sell it today you would earn a total of 33,975 from holding Centum Electronics Limited or generate 20.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centum Electronics Limited vs. Hexa Tradex Limited
Performance |
| Timeline |
| Centum Electronics |
| Hexa Tradex Limited |
Centum Electronics and Hexa Tradex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centum Electronics and Hexa Tradex
The main advantage of trading using opposite Centum Electronics and Hexa Tradex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centum Electronics position performs unexpectedly, Hexa Tradex 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 Hexa Tradex will offset losses from the drop in Hexa Tradex's long position.| Centum Electronics vs. Next Mediaworks Limited | Centum Electronics vs. HT Media Limited | Centum Electronics vs. The Indian Hotels | Centum Electronics vs. Samhi Hotels Limited |
| Hexa Tradex vs. MIC Electronics Limited | Hexa Tradex vs. Future Retail Limited | Hexa Tradex vs. Manaksia Coated Metals | Hexa Tradex vs. Centum Electronics 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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