Correlation Between ICICI Bank and KPIT Technologies
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By analyzing existing cross correlation between ICICI Bank Limited and KPIT Technologies Limited, you can compare the effects of market volatilities on ICICI Bank and KPIT Technologies 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 KPIT Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICICI Bank and KPIT Technologies.
Diversification Opportunities for ICICI Bank and KPIT Technologies
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ICICI and KPIT is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding ICICI Bank Limited and KPIT Technologies Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KPIT Technologies 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 KPIT Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KPIT Technologies has no effect on the direction of ICICI Bank i.e., ICICI Bank and KPIT Technologies go up and down completely randomly.
Pair Corralation between ICICI Bank and KPIT Technologies
Assuming the 90 days trading horizon ICICI Bank is expected to generate 2.01 times less return on investment than KPIT Technologies. But when comparing it to its historical volatility, ICICI Bank Limited is 2.09 times less risky than KPIT Technologies. It trades about 0.07 of its potential returns per unit of risk. KPIT Technologies Limited is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 70,968 in KPIT Technologies Limited on August 27, 2024 and sell it today you would earn a total of 59,877 from holding KPIT Technologies Limited or generate 84.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ICICI Bank Limited vs. KPIT Technologies Limited
Performance |
| Timeline |
| ICICI Bank Limited |
| KPIT Technologies |
ICICI Bank and KPIT Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICICI Bank and KPIT Technologies
The main advantage of trading using opposite ICICI Bank and KPIT Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICICI Bank position performs unexpectedly, KPIT Technologies 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 KPIT Technologies will offset losses from the drop in KPIT Technologies' long position.| ICICI Bank vs. Imagicaaworld Entertainment Limited | ICICI Bank vs. Sonata Software Limited | ICICI Bank vs. Tata Communications Limited | ICICI Bank vs. Datamatics Global Services |
| KPIT Technologies vs. R S Software | KPIT Technologies vs. Elgi Rubber | KPIT Technologies vs. Varun Beverages Limited | KPIT Technologies vs. Kilitch Drugs Limited |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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