Correlation Between ICICI Bank and Patanjali Foods
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By analyzing existing cross correlation between ICICI Bank Limited and Patanjali Foods Limited, you can compare the effects of market volatilities on ICICI Bank and Patanjali Foods 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 Patanjali Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICICI Bank and Patanjali Foods.
Diversification Opportunities for ICICI Bank and Patanjali Foods
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between ICICI and Patanjali is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding ICICI Bank Limited and Patanjali Foods Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Patanjali Foods 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 Patanjali Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Patanjali Foods has no effect on the direction of ICICI Bank i.e., ICICI Bank and Patanjali Foods go up and down completely randomly.
Pair Corralation between ICICI Bank and Patanjali Foods
Assuming the 90 days trading horizon ICICI Bank is expected to generate 1.36 times less return on investment than Patanjali Foods. But when comparing it to its historical volatility, ICICI Bank Limited is 1.93 times less risky than Patanjali Foods. It trades about 0.08 of its potential returns per unit of risk. Patanjali Foods Limited is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 112,375 in Patanjali Foods Limited on September 14, 2024 and sell it today you would earn a total of 70,180 from holding Patanjali Foods Limited or generate 62.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
ICICI Bank Limited vs. Patanjali Foods Limited
Performance |
| Timeline |
| ICICI Bank Limited |
| Patanjali Foods |
ICICI Bank and Patanjali Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICICI Bank and Patanjali Foods
The main advantage of trading using opposite ICICI Bank and Patanjali Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICICI Bank position performs unexpectedly, Patanjali Foods 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 Patanjali Foods will offset losses from the drop in Patanjali Foods' long position.| ICICI Bank vs. Reliance Industries Limited | ICICI Bank vs. State Bank of | ICICI Bank vs. Oil Natural Gas |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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