Correlation Between Electronics Mart and Silgo Retail
Can any of the company-specific risk be diversified away by investing in both Electronics Mart and Silgo Retail at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Electronics Mart and Silgo Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electronics Mart India and Silgo Retail Limited, you can compare the effects of market volatilities on Electronics Mart and Silgo Retail 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 Electronics Mart with a short position of Silgo Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electronics Mart and Silgo Retail.
Diversification Opportunities for Electronics Mart and Silgo Retail
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Electronics and Silgo is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Electronics Mart India and Silgo Retail Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silgo Retail Limited and Electronics Mart 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 Electronics Mart India are associated (or correlated) with Silgo Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silgo Retail Limited has no effect on the direction of Electronics Mart i.e., Electronics Mart and Silgo Retail go up and down completely randomly.
Pair Corralation between Electronics Mart and Silgo Retail
Assuming the 90 days trading horizon Electronics Mart India is expected to generate 0.57 times more return on investment than Silgo Retail. However, Electronics Mart India is 1.74 times less risky than Silgo Retail. It trades about -0.35 of its potential returns per unit of risk. Silgo Retail Limited is currently generating about -0.43 per unit of risk. If you would invest 16,703 in Electronics Mart India on October 30, 2024 and sell it today you would lose (2,318) from holding Electronics Mart India or give up 13.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Electronics Mart India vs. Silgo Retail Limited
Performance |
| Timeline |
| Electronics Mart India |
| Silgo Retail Limited |
Electronics Mart and Silgo Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electronics Mart and Silgo Retail
The main advantage of trading using opposite Electronics Mart and Silgo Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electronics Mart position performs unexpectedly, Silgo Retail 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 Silgo Retail will offset losses from the drop in Silgo Retail's long position.| Electronics Mart vs. Manaksia Steels Limited | Electronics Mart vs. Mahamaya Steel Industries | Electronics Mart vs. Foods Inns Limited | Electronics Mart vs. Dodla Dairy Limited |
| Silgo Retail vs. Osia Hyper Retail | Silgo Retail vs. Hindustan Foods Limited | Silgo Retail vs. Baazar Style Retail | Silgo Retail vs. Bikaji Foods International |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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