Correlation Between ICICI Lombard and CEAT
Specify exactly 2 symbols:
By analyzing existing cross correlation between ICICI Lombard General and CEAT Limited, you can compare the effects of market volatilities on ICICI Lombard and CEAT 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 Lombard with a short position of CEAT. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICICI Lombard and CEAT.
Diversification Opportunities for ICICI Lombard and CEAT
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ICICI and CEAT is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding ICICI Lombard General and CEAT Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CEAT Limited and ICICI Lombard 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 Lombard General are associated (or correlated) with CEAT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CEAT Limited has no effect on the direction of ICICI Lombard i.e., ICICI Lombard and CEAT go up and down completely randomly.
Pair Corralation between ICICI Lombard and CEAT
Assuming the 90 days trading horizon ICICI Lombard General is expected to under-perform the CEAT. But the stock apears to be less risky and, when comparing its historical volatility, ICICI Lombard General is 1.53 times less risky than CEAT. The stock trades about -0.19 of its potential returns per unit of risk. The CEAT Limited is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 279,565 in CEAT Limited on August 31, 2024 and sell it today you would earn a total of 17,720 from holding CEAT Limited or generate 6.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.39% |
| Values | Daily Returns |
ICICI Lombard General vs. CEAT Limited
Performance |
| Timeline |
| ICICI Lombard General |
| CEAT Limited |
ICICI Lombard and CEAT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICICI Lombard and CEAT
The main advantage of trading using opposite ICICI Lombard and CEAT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICICI Lombard position performs unexpectedly, CEAT 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 CEAT will offset losses from the drop in CEAT's long position.| ICICI Lombard vs. Kavveri Telecom Products | ICICI Lombard vs. Manaksia Coated Metals | ICICI Lombard vs. Uniinfo Telecom Services | ICICI Lombard vs. Nahar Industrial Enterprises |
| CEAT vs. EMBASSY OFFICE PARKS | CEAT vs. Repco Home Finance | CEAT vs. Reliance Home Finance | CEAT vs. SIL Investments 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |