Correlation Between ICICI Bank and Golden Tobacco
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By analyzing existing cross correlation between ICICI Bank Limited and Golden Tobacco Limited, you can compare the effects of market volatilities on ICICI Bank and Golden Tobacco 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 Golden Tobacco. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICICI Bank and Golden Tobacco.
Diversification Opportunities for ICICI Bank and Golden Tobacco
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between ICICI and Golden is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding ICICI Bank Limited and Golden Tobacco Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Tobacco 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 Golden Tobacco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Tobacco has no effect on the direction of ICICI Bank i.e., ICICI Bank and Golden Tobacco go up and down completely randomly.
Pair Corralation between ICICI Bank and Golden Tobacco
Assuming the 90 days trading horizon ICICI Bank Limited is expected to generate 0.55 times more return on investment than Golden Tobacco. However, ICICI Bank Limited is 1.82 times less risky than Golden Tobacco. It trades about 0.12 of its potential returns per unit of risk. Golden Tobacco Limited is currently generating about -0.01 per unit of risk. If you would invest 111,138 in ICICI Bank Limited on September 5, 2024 and sell it today you would earn a total of 19,702 from holding ICICI Bank Limited or generate 17.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.19% |
| Values | Daily Returns |
ICICI Bank Limited vs. Golden Tobacco Limited
Performance |
| Timeline |
| ICICI Bank Limited |
| Golden Tobacco |
ICICI Bank and Golden Tobacco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICICI Bank and Golden Tobacco
The main advantage of trading using opposite ICICI Bank and Golden Tobacco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICICI Bank position performs unexpectedly, Golden Tobacco 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 Golden Tobacco will offset losses from the drop in Golden Tobacco's long position.| ICICI Bank vs. City Union Bank | ICICI Bank vs. California Software | ICICI Bank vs. Data Patterns Limited | ICICI Bank vs. Geojit Financial Services |
| Golden Tobacco vs. Silly Monks Entertainment | Golden Tobacco vs. Aarey Drugs Pharmaceuticals | Golden Tobacco vs. Indraprastha Medical | Golden Tobacco vs. Zee Entertainment Enterprises |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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