Correlation Between ICICI Bank and Lotus Eye
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By analyzing existing cross correlation between ICICI Bank Limited and Lotus Eye Hospital, you can compare the effects of market volatilities on ICICI Bank and Lotus Eye 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 Lotus Eye. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICICI Bank and Lotus Eye.
Diversification Opportunities for ICICI Bank and Lotus Eye
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ICICI and Lotus is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding ICICI Bank Limited and Lotus Eye Hospital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lotus Eye Hospital 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 Lotus Eye. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lotus Eye Hospital has no effect on the direction of ICICI Bank i.e., ICICI Bank and Lotus Eye go up and down completely randomly.
Pair Corralation between ICICI Bank and Lotus Eye
Assuming the 90 days trading horizon ICICI Bank Limited is expected to generate 0.35 times more return on investment than Lotus Eye. However, ICICI Bank Limited is 2.87 times less risky than Lotus Eye. It trades about 0.07 of its potential returns per unit of risk. Lotus Eye Hospital is currently generating about 0.01 per unit of risk. If you would invest 84,208 in ICICI Bank Limited on November 28, 2024 and sell it today you would earn a total of 38,207 from holding ICICI Bank Limited or generate 45.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
ICICI Bank Limited vs. Lotus Eye Hospital
Performance |
| Timeline |
| ICICI Bank Limited |
| Lotus Eye Hospital |
ICICI Bank and Lotus Eye Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICICI Bank and Lotus Eye
The main advantage of trading using opposite ICICI Bank and Lotus Eye positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICICI Bank position performs unexpectedly, Lotus Eye 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 Lotus Eye will offset losses from the drop in Lotus Eye's long position.| ICICI Bank vs. Yatra Online Limited | ICICI Bank vs. LLOYDS METALS AND | ICICI Bank vs. Hilton Metal Forging | ICICI Bank vs. Praxis Home Retail |
| Lotus Eye vs. Associated Alcohols Breweries | Lotus Eye vs. Speciality Restaurants Limited | Lotus Eye vs. Tata Communications Limited | Lotus Eye vs. Paramount Communications 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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