Correlation Between General Insurance and Megastar Foods
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By analyzing existing cross correlation between General Insurance and Megastar Foods Limited, you can compare the effects of market volatilities on General Insurance and Megastar Foods 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 General Insurance with a short position of Megastar Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of General Insurance and Megastar Foods.
Diversification Opportunities for General Insurance and Megastar Foods
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between General and Megastar is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding General Insurance and Megastar Foods Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Megastar Foods and General Insurance 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 General Insurance are associated (or correlated) with Megastar Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Megastar Foods has no effect on the direction of General Insurance i.e., General Insurance and Megastar Foods go up and down completely randomly.
Pair Corralation between General Insurance and Megastar Foods
Assuming the 90 days trading horizon General Insurance is expected to generate 0.99 times more return on investment than Megastar Foods. However, General Insurance is 1.01 times less risky than Megastar Foods. It trades about 0.11 of its potential returns per unit of risk. Megastar Foods Limited is currently generating about 0.06 per unit of risk. If you would invest 35,995 in General Insurance on October 24, 2024 and sell it today you would earn a total of 7,490 from holding General Insurance or generate 20.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Insurance vs. Megastar Foods Limited
Performance |
| Timeline |
| General Insurance |
| Megastar Foods |
General Insurance and Megastar Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with General Insurance and Megastar Foods
The main advantage of trading using opposite General Insurance and Megastar Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if General Insurance position performs unexpectedly, Megastar Foods 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 Megastar Foods will offset losses from the drop in Megastar Foods' long position.| General Insurance vs. Reliance Industries Limited | General Insurance vs. Oil Natural Gas | General Insurance vs. ICICI Bank Limited | General Insurance vs. Bharti Airtel Limited |
| Megastar Foods vs. Electrosteel Castings Limited | Megastar Foods vs. General Insurance | Megastar Foods vs. Rama Steel Tubes | Megastar Foods vs. State Bank of |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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