Correlation Between COSMO FIRST and Megastar Foods
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By analyzing existing cross correlation between COSMO FIRST LIMITED and Megastar Foods Limited, you can compare the effects of market volatilities on COSMO FIRST and Megastar Foods 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 COSMO FIRST with a short position of Megastar Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of COSMO FIRST and Megastar Foods.
Diversification Opportunities for COSMO FIRST and Megastar Foods
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between COSMO and Megastar is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding COSMO FIRST LIMITED and Megastar Foods Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Megastar Foods and COSMO FIRST 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 COSMO FIRST LIMITED are associated (or correlated) with Megastar Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Megastar Foods has no effect on the direction of COSMO FIRST i.e., COSMO FIRST and Megastar Foods go up and down completely randomly.
Pair Corralation between COSMO FIRST and Megastar Foods
Assuming the 90 days trading horizon COSMO FIRST LIMITED is expected to generate 1.44 times more return on investment than Megastar Foods. However, COSMO FIRST is 1.44 times more volatile than Megastar Foods Limited. It trades about -0.33 of its potential returns per unit of risk. Megastar Foods Limited is currently generating about -0.48 per unit of risk. If you would invest 72,415 in COSMO FIRST LIMITED on December 1, 2024 and sell it today you would lose (12,525) from holding COSMO FIRST LIMITED or give up 17.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
COSMO FIRST LIMITED vs. Megastar Foods Limited
Performance |
| Timeline |
| COSMO FIRST LIMITED |
| Megastar Foods |
COSMO FIRST and Megastar Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COSMO FIRST and Megastar Foods
The main advantage of trading using opposite COSMO FIRST and Megastar Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COSMO FIRST position performs unexpectedly, Megastar Foods 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 Megastar Foods will offset losses from the drop in Megastar Foods' long position.| COSMO FIRST vs. LT Technology Services | COSMO FIRST vs. FCS Software Solutions | COSMO FIRST vs. Syrma SGS Technology | COSMO FIRST vs. Le Travenues Technology |
| Megastar Foods vs. Union Bank of | Megastar Foods vs. IDFC First Bank | Megastar Foods vs. SBI Life Insurance | Megastar Foods vs. Bhagiradha Chemicals 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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