Correlation Between Eros International and Arrow Greentech
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By analyzing existing cross correlation between Eros International Media and Arrow Greentech Limited, you can compare the effects of market volatilities on Eros International and Arrow Greentech 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 Eros International with a short position of Arrow Greentech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eros International and Arrow Greentech.
Diversification Opportunities for Eros International and Arrow Greentech
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eros and Arrow is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Eros International Media and Arrow Greentech Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arrow Greentech and Eros International 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 Eros International Media are associated (or correlated) with Arrow Greentech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arrow Greentech has no effect on the direction of Eros International i.e., Eros International and Arrow Greentech go up and down completely randomly.
Pair Corralation between Eros International and Arrow Greentech
Assuming the 90 days trading horizon Eros International Media is expected to under-perform the Arrow Greentech. But the stock apears to be less risky and, when comparing its historical volatility, Eros International Media is 1.22 times less risky than Arrow Greentech. The stock trades about -0.04 of its potential returns per unit of risk. The Arrow Greentech Limited is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 16,966 in Arrow Greentech Limited on October 26, 2024 and sell it today you would earn a total of 55,224 from holding Arrow Greentech Limited or generate 325.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.59% |
| Values | Daily Returns |
Eros International Media vs. Arrow Greentech Limited
Performance |
| Timeline |
| Eros International Media |
| Arrow Greentech |
Eros International and Arrow Greentech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eros International and Arrow Greentech
The main advantage of trading using opposite Eros International and Arrow Greentech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eros International position performs unexpectedly, Arrow Greentech 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 Arrow Greentech will offset losses from the drop in Arrow Greentech's long position.| Eros International vs. Infomedia Press Limited | Eros International vs. Network18 Media Investments | Eros International vs. Radaan Mediaworks India | Eros International vs. ZF Commercial Vehicle |
| Arrow Greentech vs. NMDC Limited | Arrow Greentech vs. Steel Authority of | Arrow Greentech vs. Embassy Office Parks | Arrow Greentech vs. Jai Balaji 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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