Correlation Between GM Breweries and State Bank
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By analyzing existing cross correlation between GM Breweries Limited and State Bank of, you can compare the effects of market volatilities on GM Breweries and State Bank 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 GM Breweries with a short position of State Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM Breweries and State Bank.
Diversification Opportunities for GM Breweries and State Bank
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GMBREW and State is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding GM Breweries Limited and State Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Bank and GM Breweries 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 GM Breweries Limited are associated (or correlated) with State Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Bank has no effect on the direction of GM Breweries i.e., GM Breweries and State Bank go up and down completely randomly.
Pair Corralation between GM Breweries and State Bank
Assuming the 90 days trading horizon GM Breweries Limited is expected to generate 1.76 times more return on investment than State Bank. However, GM Breweries is 1.76 times more volatile than State Bank of. It trades about 0.03 of its potential returns per unit of risk. State Bank of is currently generating about -0.02 per unit of risk. If you would invest 79,885 in GM Breweries Limited on September 21, 2024 and sell it today you would earn a total of 4,520 from holding GM Breweries Limited or generate 5.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GM Breweries Limited vs. State Bank of
Performance |
| Timeline |
| GM Breweries Limited |
| State Bank |
GM Breweries and State Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM Breweries and State Bank
The main advantage of trading using opposite GM Breweries and State Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM Breweries position performs unexpectedly, State Bank 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 State Bank will offset losses from the drop in State Bank's long position.| GM Breweries vs. Kaushalya Infrastructure Development | GM Breweries vs. Tarapur Transformers Limited | GM Breweries vs. Kingfa Science Technology | GM Breweries vs. Rico Auto Industries |
| State Bank vs. Nalwa Sons Investments | State Bank vs. GM Breweries Limited | State Bank vs. UTI Asset Management | State Bank vs. Computer Age Management |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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