Correlation Between Hub Power and ITTEFAQ Iron
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By analyzing existing cross correlation between Hub Power and ITTEFAQ Iron Industries, you can compare the effects of market volatilities on Hub Power and ITTEFAQ Iron 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 Hub Power with a short position of ITTEFAQ Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hub Power and ITTEFAQ Iron.
Diversification Opportunities for Hub Power and ITTEFAQ Iron
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hub and ITTEFAQ is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Hub Power and ITTEFAQ Iron Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ITTEFAQ Iron Industries and Hub Power 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 Hub Power are associated (or correlated) with ITTEFAQ Iron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ITTEFAQ Iron Industries has no effect on the direction of Hub Power i.e., Hub Power and ITTEFAQ Iron go up and down completely randomly.
Pair Corralation between Hub Power and ITTEFAQ Iron
Assuming the 90 days trading horizon Hub Power is expected to generate 0.66 times more return on investment than ITTEFAQ Iron. However, Hub Power is 1.51 times less risky than ITTEFAQ Iron. It trades about 0.07 of its potential returns per unit of risk. ITTEFAQ Iron Industries is currently generating about 0.04 per unit of risk. If you would invest 8,654 in Hub Power on October 25, 2024 and sell it today you would earn a total of 4,521 from holding Hub Power or generate 52.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hub Power vs. ITTEFAQ Iron Industries
Performance |
| Timeline |
| Hub Power |
| ITTEFAQ Iron Industries |
Hub Power and ITTEFAQ Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hub Power and ITTEFAQ Iron
The main advantage of trading using opposite Hub Power and ITTEFAQ Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hub Power position performs unexpectedly, ITTEFAQ Iron 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 ITTEFAQ Iron will offset losses from the drop in ITTEFAQ Iron's long position.| Hub Power vs. ITTEFAQ Iron Industries | Hub Power vs. JS Investments | Hub Power vs. Wah Nobel Chemicals | Hub Power vs. International Steels |
| ITTEFAQ Iron vs. Hi Tech Lubricants | ITTEFAQ Iron vs. Air Link Communication | ITTEFAQ Iron vs. Packages | ITTEFAQ Iron vs. International Steels |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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