Correlation Between ICICI Bank and GM Breweries
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By analyzing existing cross correlation between ICICI Bank Limited and GM Breweries Limited, you can compare the effects of market volatilities on ICICI Bank and GM Breweries 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 ICICI Bank with a short position of GM Breweries. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICICI Bank and GM Breweries.
Diversification Opportunities for ICICI Bank and GM Breweries
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ICICI and GMBREW is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding ICICI Bank Limited and GM Breweries Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GM Breweries Limited and ICICI Bank 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 ICICI Bank Limited are associated (or correlated) with GM Breweries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GM Breweries Limited has no effect on the direction of ICICI Bank i.e., ICICI Bank and GM Breweries go up and down completely randomly.
Pair Corralation between ICICI Bank and GM Breweries
Assuming the 90 days trading horizon ICICI Bank Limited is expected to generate 0.27 times more return on investment than GM Breweries. However, ICICI Bank Limited is 3.7 times less risky than GM Breweries. It trades about -0.26 of its potential returns per unit of risk. GM Breweries Limited is currently generating about -0.22 per unit of risk. If you would invest 125,855 in ICICI Bank Limited on December 1, 2024 and sell it today you would lose (5,445) from holding ICICI Bank Limited or give up 4.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ICICI Bank Limited vs. GM Breweries Limited
Performance |
| Timeline |
| ICICI Bank Limited |
| GM Breweries Limited |
ICICI Bank and GM Breweries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICICI Bank and GM Breweries
The main advantage of trading using opposite ICICI Bank and GM Breweries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICICI Bank position performs unexpectedly, GM Breweries 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 GM Breweries will offset losses from the drop in GM Breweries' long position.| ICICI Bank vs. Sintex Plastics Technology | ICICI Bank vs. FCS Software Solutions | ICICI Bank vs. LT Technology Services | ICICI Bank vs. DiGiSPICE Technologies Limited |
| GM Breweries vs. NRB Industrial Bearings | GM Breweries vs. Reliance Industrial Infrastructure | GM Breweries vs. Credo Brands Marketing | GM Breweries vs. Ankit Metal Power |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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