Correlation Between Federal Bank and V Mart
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By analyzing existing cross correlation between The Federal Bank and V Mart Retail Limited, you can compare the effects of market volatilities on Federal Bank and V Mart 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 Federal Bank with a short position of V Mart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federal Bank and V Mart.
Diversification Opportunities for Federal Bank and V Mart
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Federal and VMART is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding The Federal Bank and V Mart Retail Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on V Mart Retail and Federal Bank 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 The Federal Bank are associated (or correlated) with V Mart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of V Mart Retail has no effect on the direction of Federal Bank i.e., Federal Bank and V Mart go up and down completely randomly.
Pair Corralation between Federal Bank and V Mart
Assuming the 90 days trading horizon The Federal Bank is expected to generate 0.79 times more return on investment than V Mart. However, The Federal Bank is 1.27 times less risky than V Mart. It trades about 0.05 of its potential returns per unit of risk. V Mart Retail Limited is currently generating about 0.03 per unit of risk. If you would invest 13,592 in The Federal Bank on September 24, 2024 and sell it today you would earn a total of 5,854 from holding The Federal Bank or generate 43.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
The Federal Bank vs. V Mart Retail Limited
Performance |
| Timeline |
| Federal Bank |
| V Mart Retail |
Federal Bank and V Mart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federal Bank and V Mart
The main advantage of trading using opposite Federal Bank and V Mart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federal Bank position performs unexpectedly, V Mart 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 V Mart will offset losses from the drop in V Mart's long position.| Federal Bank vs. Omkar Speciality Chemicals | Federal Bank vs. JB Chemicals Pharmaceuticals | Federal Bank vs. Hilton Metal Forging | Federal Bank vs. Speciality Restaurants Limited |
| V Mart vs. Ankit Metal Power | V Mart vs. The Federal Bank | V Mart vs. Hybrid Financial Services | V Mart vs. Max Financial Services |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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