Correlation Between Golden Tobacco and ITI
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By analyzing existing cross correlation between Golden Tobacco Limited and ITI Limited, you can compare the effects of market volatilities on Golden Tobacco and ITI 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 Golden Tobacco with a short position of ITI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Tobacco and ITI.
Diversification Opportunities for Golden Tobacco and ITI
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Golden and ITI is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Golden Tobacco Limited and ITI Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ITI Limited and Golden Tobacco 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 Golden Tobacco Limited are associated (or correlated) with ITI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ITI Limited has no effect on the direction of Golden Tobacco i.e., Golden Tobacco and ITI go up and down completely randomly.
Pair Corralation between Golden Tobacco and ITI
Assuming the 90 days trading horizon Golden Tobacco Limited is expected to under-perform the ITI. But the stock apears to be less risky and, when comparing its historical volatility, Golden Tobacco Limited is 1.69 times less risky than ITI. The stock trades about -0.01 of its potential returns per unit of risk. The ITI Limited is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 30,555 in ITI Limited on November 24, 2024 and sell it today you would lose (2,290) from holding ITI Limited or give up 7.49% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Golden Tobacco Limited vs. ITI Limited
Performance |
Timeline |
Golden Tobacco |
ITI Limited |
Golden Tobacco and ITI Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Golden Tobacco and ITI
The main advantage of trading using opposite Golden Tobacco and ITI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Tobacco position performs unexpectedly, ITI 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 ITI will offset losses from the drop in ITI's long position.Golden Tobacco vs. Praxis Home Retail | ||
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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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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