Correlation Between Cholamandalam Financial and BF Investment
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By analyzing existing cross correlation between Cholamandalam Financial Holdings and BF Investment Limited, you can compare the effects of market volatilities on Cholamandalam Financial and BF Investment 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 Cholamandalam Financial with a short position of BF Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cholamandalam Financial and BF Investment.
Diversification Opportunities for Cholamandalam Financial and BF Investment
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cholamandalam and BFINVEST is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Cholamandalam Financial Holdin and BF Investment Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BF Investment Limited and Cholamandalam Financial 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 Cholamandalam Financial Holdings are associated (or correlated) with BF Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BF Investment Limited has no effect on the direction of Cholamandalam Financial i.e., Cholamandalam Financial and BF Investment go up and down completely randomly.
Pair Corralation between Cholamandalam Financial and BF Investment
Assuming the 90 days trading horizon Cholamandalam Financial is expected to generate 1.13 times less return on investment than BF Investment. But when comparing it to its historical volatility, Cholamandalam Financial Holdings is 1.41 times less risky than BF Investment. It trades about 0.09 of its potential returns per unit of risk. BF Investment Limited is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 37,705 in BF Investment Limited on September 2, 2024 and sell it today you would earn a total of 35,575 from holding BF Investment Limited or generate 94.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.18% |
| Values | Daily Returns |
Cholamandalam Financial Holdin vs. BF Investment Limited
Performance |
| Timeline |
| Cholamandalam Financial |
| BF Investment Limited |
Cholamandalam Financial and BF Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cholamandalam Financial and BF Investment
The main advantage of trading using opposite Cholamandalam Financial and BF Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cholamandalam Financial position performs unexpectedly, BF Investment 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 BF Investment will offset losses from the drop in BF Investment's long position.| Cholamandalam Financial vs. Life Insurance | Cholamandalam Financial vs. Hi Tech Pipes Limited | Cholamandalam Financial vs. Tips Music Limited | Cholamandalam Financial vs. DiGiSPICE Technologies Limited |
| BF Investment vs. Sonata Software Limited | BF Investment vs. GM Breweries Limited | BF Investment vs. California Software | BF Investment vs. STEEL EXCHANGE 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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