Correlation Between Foods Inns and Agro Tech
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By analyzing existing cross correlation between Foods Inns Limited and Agro Tech Foods, you can compare the effects of market volatilities on Foods Inns and Agro Tech 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 Foods Inns with a short position of Agro Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Foods Inns and Agro Tech.
Diversification Opportunities for Foods Inns and Agro Tech
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Foods and Agro is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Foods Inns Limited and Agro Tech Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agro Tech Foods and Foods Inns 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 Foods Inns Limited are associated (or correlated) with Agro Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agro Tech Foods has no effect on the direction of Foods Inns i.e., Foods Inns and Agro Tech go up and down completely randomly.
Pair Corralation between Foods Inns and Agro Tech
Assuming the 90 days trading horizon Foods Inns Limited is expected to under-perform the Agro Tech. But the stock apears to be less risky and, when comparing its historical volatility, Foods Inns Limited is 1.43 times less risky than Agro Tech. The stock trades about -0.29 of its potential returns per unit of risk. The Agro Tech Foods is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 95,735 in Agro Tech Foods on August 24, 2024 and sell it today you would lose (8,225) from holding Agro Tech Foods or give up 8.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Foods Inns Limited vs. Agro Tech Foods
Performance |
| Timeline |
| Foods Inns Limited |
| Agro Tech Foods |
Foods Inns and Agro Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Foods Inns and Agro Tech
The main advantage of trading using opposite Foods Inns and Agro Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Foods Inns position performs unexpectedly, Agro Tech 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 Agro Tech will offset losses from the drop in Agro Tech's long position.| Foods Inns vs. V2 Retail Limited | Foods Inns vs. Future Retail Limited | Foods Inns vs. Sonata Software Limited | Foods Inns vs. Zodiac Clothing |
| Agro Tech vs. Ratnamani Metals Tubes | Agro Tech vs. Bosch Limited | Agro Tech vs. Bajaj Holdings Investment | Agro Tech vs. Vardhman Holdings 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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