Correlation Between Hi Tech and BF Investment
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By analyzing existing cross correlation between The Hi Tech Gears and BF Investment Limited, you can compare the effects of market volatilities on Hi Tech and BF Investment 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 Hi Tech with a short position of BF Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hi Tech and BF Investment.
Diversification Opportunities for Hi Tech and BF Investment
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between HITECHGEAR and BFINVEST is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding The Hi Tech Gears and BF Investment Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BF Investment Limited and Hi Tech 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 The Hi Tech Gears are associated (or correlated) with BF Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BF Investment Limited has no effect on the direction of Hi Tech i.e., Hi Tech and BF Investment go up and down completely randomly.
Pair Corralation between Hi Tech and BF Investment
Assuming the 90 days trading horizon The Hi Tech Gears is expected to generate 1.06 times more return on investment than BF Investment. However, Hi Tech is 1.06 times more volatile than BF Investment Limited. It trades about 0.09 of its potential returns per unit of risk. BF Investment Limited is currently generating about 0.05 per unit of risk. If you would invest 24,806 in The Hi Tech Gears on October 13, 2024 and sell it today you would earn a total of 54,289 from holding The Hi Tech Gears or generate 218.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.39% |
| Values | Daily Returns |
The Hi Tech Gears vs. BF Investment Limited
Performance |
| Timeline |
| Hi Tech |
| BF Investment Limited |
Hi Tech and BF Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hi Tech and BF Investment
The main advantage of trading using opposite Hi Tech and BF Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hi Tech position performs unexpectedly, BF Investment 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 BF Investment will offset losses from the drop in BF Investment's long position.| Hi Tech vs. Alkali Metals Limited | Hi Tech vs. GM Breweries Limited | Hi Tech vs. Varun Beverages Limited | Hi Tech vs. Megastar Foods Limited |
| BF Investment vs. Pritish Nandy Communications | BF Investment vs. Vibhor Steel Tubes | BF Investment vs. Kalyani Steels Limited | BF Investment vs. The Hi Tech Gears |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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