Correlation Between Elin Electronics and Bank of Baroda
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By analyzing existing cross correlation between Elin Electronics Limited and Bank of Baroda, you can compare the effects of market volatilities on Elin Electronics and Bank of Baroda 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 Elin Electronics with a short position of Bank of Baroda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elin Electronics and Bank of Baroda.
Diversification Opportunities for Elin Electronics and Bank of Baroda
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Elin and Bank is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Elin Electronics Limited and Bank of Baroda in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Baroda and Elin 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 Elin Electronics Limited are associated (or correlated) with Bank of Baroda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Baroda has no effect on the direction of Elin Electronics i.e., Elin Electronics and Bank of Baroda go up and down completely randomly.
Pair Corralation between Elin Electronics and Bank of Baroda
Assuming the 90 days trading horizon Elin Electronics is expected to generate 1.12 times less return on investment than Bank of Baroda. But when comparing it to its historical volatility, Elin Electronics Limited is 1.03 times less risky than Bank of Baroda. It trades about 0.17 of its potential returns per unit of risk. Bank of Baroda is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 24,150 in Bank of Baroda on September 15, 2024 and sell it today you would earn a total of 1,649 from holding Bank of Baroda or generate 6.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Elin Electronics Limited vs. Bank of Baroda
Performance |
| Timeline |
| Elin Electronics |
| Bank of Baroda |
Elin Electronics and Bank of Baroda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elin Electronics and Bank of Baroda
The main advantage of trading using opposite Elin Electronics and Bank of Baroda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elin Electronics position performs unexpectedly, Bank of Baroda 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 Bank of Baroda will offset losses from the drop in Bank of Baroda's long position.| Elin Electronics vs. Reliance Industries Limited | Elin Electronics vs. Oil Natural Gas | Elin Electronics vs. ICICI Bank Limited | Elin Electronics vs. Bharti Airtel Limited |
| Bank of Baroda vs. ADF Foods Limited | Bank of Baroda vs. Transport of | Bank of Baroda vs. LT Foods Limited | Bank of Baroda vs. Foods Inns 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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