Correlation Between Dost Steels and Mughal Iron
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By analyzing existing cross correlation between Dost Steels and Mughal Iron Steel, you can compare the effects of market volatilities on Dost Steels and Mughal Iron 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 Dost Steels with a short position of Mughal Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dost Steels and Mughal Iron.
Diversification Opportunities for Dost Steels and Mughal Iron
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dost and Mughal is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Dost Steels and Mughal Iron Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mughal Iron Steel and Dost Steels 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 Dost Steels are associated (or correlated) with Mughal Iron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mughal Iron Steel has no effect on the direction of Dost Steels i.e., Dost Steels and Mughal Iron go up and down completely randomly.
Pair Corralation between Dost Steels and Mughal Iron
Assuming the 90 days trading horizon Dost Steels is expected to generate 1.87 times less return on investment than Mughal Iron. In addition to that, Dost Steels is 1.04 times more volatile than Mughal Iron Steel. It trades about 0.03 of its total potential returns per unit of risk. Mughal Iron Steel is currently generating about 0.06 per unit of volatility. If you would invest 4,923 in Mughal Iron Steel on September 2, 2024 and sell it today you would earn a total of 2,445 from holding Mughal Iron Steel or generate 49.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dost Steels vs. Mughal Iron Steel
Performance |
| Timeline |
| Dost Steels |
| Mughal Iron Steel |
Dost Steels and Mughal Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dost Steels and Mughal Iron
The main advantage of trading using opposite Dost Steels and Mughal Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dost Steels position performs unexpectedly, Mughal Iron 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 Mughal Iron will offset losses from the drop in Mughal Iron's long position.| Dost Steels vs. Pakistan Telecommunication | Dost Steels vs. Askari Bank | Dost Steels vs. Adamjee Insurance | Dost Steels vs. Soneri Bank |
| Mughal Iron vs. Masood Textile Mills | Mughal Iron vs. Fauji Foods | Mughal Iron vs. KSB Pumps | Mughal Iron vs. Mari Petroleum |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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