Correlation Between INDIKA ENERGY and Bayer AG
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By analyzing existing cross correlation between INDIKA ENERGY and Bayer AG NA, you can compare the effects of market volatilities on INDIKA ENERGY and Bayer AG 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 INDIKA ENERGY with a short position of Bayer AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of INDIKA ENERGY and Bayer AG.
Diversification Opportunities for INDIKA ENERGY and Bayer AG
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between INDIKA and Bayer is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding INDIKA ENERGY and Bayer AG NA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bayer AG NA and INDIKA ENERGY 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 INDIKA ENERGY are associated (or correlated) with Bayer AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bayer AG NA has no effect on the direction of INDIKA ENERGY i.e., INDIKA ENERGY and Bayer AG go up and down completely randomly.
Pair Corralation between INDIKA ENERGY and Bayer AG
Assuming the 90 days trading horizon INDIKA ENERGY is expected to generate 0.07 times more return on investment than Bayer AG. However, INDIKA ENERGY is 14.91 times less risky than Bayer AG. It trades about -0.21 of its potential returns per unit of risk. Bayer AG NA is currently generating about -0.35 per unit of risk. If you would invest 9.30 in INDIKA ENERGY on August 30, 2024 and sell it today you would lose (0.10) from holding INDIKA ENERGY or give up 1.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
INDIKA ENERGY vs. Bayer AG NA
Performance |
| Timeline |
| INDIKA ENERGY |
| Bayer AG NA |
INDIKA ENERGY and Bayer AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INDIKA ENERGY and Bayer AG
The main advantage of trading using opposite INDIKA ENERGY and Bayer AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INDIKA ENERGY position performs unexpectedly, Bayer AG 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 Bayer AG will offset losses from the drop in Bayer AG's long position.| INDIKA ENERGY vs. GALENA MINING LTD | INDIKA ENERGY vs. Micron Technology | INDIKA ENERGY vs. FANDIFI TECHNOLOGY P | INDIKA ENERGY vs. Perseus Mining Limited |
| Bayer AG vs. Park Hotels Resorts | Bayer AG vs. Xenia Hotels Resorts | Bayer AG vs. HYATT HOTELS A | Bayer AG vs. Playa Hotels Resorts |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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