Correlation Between City Union and Sukhjit Starch
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By analyzing existing cross correlation between City Union Bank and Sukhjit Starch Chemicals, you can compare the effects of market volatilities on City Union and Sukhjit Starch 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 City Union with a short position of Sukhjit Starch. Check out your portfolio center. Please also check ongoing floating volatility patterns of City Union and Sukhjit Starch.
Diversification Opportunities for City Union and Sukhjit Starch
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between City and Sukhjit is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding City Union Bank and Sukhjit Starch Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sukhjit Starch Chemicals and City Union 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 City Union Bank are associated (or correlated) with Sukhjit Starch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sukhjit Starch Chemicals has no effect on the direction of City Union i.e., City Union and Sukhjit Starch go up and down completely randomly.
Pair Corralation between City Union and Sukhjit Starch
Assuming the 90 days trading horizon City Union is expected to generate 3.59 times less return on investment than Sukhjit Starch. But when comparing it to its historical volatility, City Union Bank is 2.08 times less risky than Sukhjit Starch. It trades about 0.09 of its potential returns per unit of risk. Sukhjit Starch Chemicals is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 24,915 in Sukhjit Starch Chemicals on September 1, 2024 and sell it today you would earn a total of 1,953 from holding Sukhjit Starch Chemicals or generate 7.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
City Union Bank vs. Sukhjit Starch Chemicals
Performance |
| Timeline |
| City Union Bank |
| Sukhjit Starch Chemicals |
City Union and Sukhjit Starch Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with City Union and Sukhjit Starch
The main advantage of trading using opposite City Union and Sukhjit Starch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if City Union position performs unexpectedly, Sukhjit Starch 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 Sukhjit Starch will offset losses from the drop in Sukhjit Starch's long position.| City Union vs. Reliance Industrial Infrastructure | City Union vs. NRB Industrial Bearings | City Union vs. Indian Metals Ferro | City Union vs. Shivalik Bimetal Controls |
| Sukhjit Starch vs. Sumitomo Chemical India | Sukhjit Starch vs. DMCC SPECIALITY CHEMICALS | Sukhjit Starch vs. California Software | Sukhjit Starch vs. Selan Exploration Technology |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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