Correlation Between ICICI Bank and Investment Trust
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By analyzing existing cross correlation between ICICI Bank Limited and The Investment Trust, you can compare the effects of market volatilities on ICICI Bank and Investment Trust 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 Investment Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICICI Bank and Investment Trust.
Diversification Opportunities for ICICI Bank and Investment Trust
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ICICI and Investment is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding ICICI Bank Limited and The Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investment Trust 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 Investment Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investment Trust has no effect on the direction of ICICI Bank i.e., ICICI Bank and Investment Trust go up and down completely randomly.
Pair Corralation between ICICI Bank and Investment Trust
Assuming the 90 days trading horizon ICICI Bank is expected to generate 1.38 times less return on investment than Investment Trust. But when comparing it to its historical volatility, ICICI Bank Limited is 2.37 times less risky than Investment Trust. It trades about 0.05 of its potential returns per unit of risk. The Investment Trust is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 20,511 in The Investment Trust on August 29, 2024 and sell it today you would earn a total of 413.00 from holding The Investment Trust or generate 2.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.56% |
| Values | Daily Returns |
ICICI Bank Limited vs. The Investment Trust
Performance |
| Timeline |
| ICICI Bank Limited |
| Investment Trust |
ICICI Bank and Investment Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICICI Bank and Investment Trust
The main advantage of trading using opposite ICICI Bank and Investment Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICICI Bank position performs unexpectedly, Investment Trust 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 Investment Trust will offset losses from the drop in Investment Trust's long position.| ICICI Bank vs. CSB Bank Limited | ICICI Bank vs. Teamlease Services Limited | ICICI Bank vs. DCB Bank Limited | ICICI Bank vs. Karur Vysya Bank |
| Investment Trust vs. MRF Limited | Investment Trust vs. Nalwa Sons Investments | Investment Trust vs. Kalyani Investment | Investment Trust vs. Pilani Investment and |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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