Correlation Between Gokul Refoils and City Union
Can any of the company-specific risk be diversified away by investing in both Gokul Refoils and City Union at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Gokul Refoils and City Union into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gokul Refoils and and City Union Bank, you can compare the effects of market volatilities on Gokul Refoils and City Union 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 Gokul Refoils with a short position of City Union. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gokul Refoils and City Union.
Diversification Opportunities for Gokul Refoils and City Union
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gokul and City is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Gokul Refoils and and City Union Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on City Union Bank and Gokul Refoils 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 Gokul Refoils and are associated (or correlated) with City Union. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of City Union Bank has no effect on the direction of Gokul Refoils i.e., Gokul Refoils and City Union go up and down completely randomly.
Pair Corralation between Gokul Refoils and City Union
Assuming the 90 days trading horizon Gokul Refoils and is expected to generate 1.56 times more return on investment than City Union. However, Gokul Refoils is 1.56 times more volatile than City Union Bank. It trades about 0.05 of its potential returns per unit of risk. City Union Bank is currently generating about 0.0 per unit of risk. If you would invest 3,580 in Gokul Refoils and on September 5, 2024 and sell it today you would earn a total of 2,189 from holding Gokul Refoils and or generate 61.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.59% |
| Values | Daily Returns |
Gokul Refoils and vs. City Union Bank
Performance |
| Timeline |
| Gokul Refoils |
| City Union Bank |
Gokul Refoils and City Union Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gokul Refoils and City Union
The main advantage of trading using opposite Gokul Refoils and City Union positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gokul Refoils position performs unexpectedly, City Union 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 City Union will offset losses from the drop in City Union's long position.| Gokul Refoils vs. Usha Martin Education | Gokul Refoils vs. EIH Associated Hotels | Gokul Refoils vs. Fineotex Chemical Limited | Gokul Refoils vs. Apollo Sindoori Hotels |
| City Union vs. Hisar Metal Industries | City Union vs. Indraprastha Medical | City Union vs. Shyam Metalics and | City Union vs. Gujarat Lease Financing |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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