Correlation Between ICICI Lombard and IDFC First
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By analyzing existing cross correlation between ICICI Lombard General and IDFC First Bank, you can compare the effects of market volatilities on ICICI Lombard and IDFC First 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 IDFC First. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICICI Lombard and IDFC First.
Diversification Opportunities for ICICI Lombard and IDFC First
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ICICI and IDFC is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding ICICI Lombard General and IDFC First Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IDFC First Bank 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 IDFC First. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IDFC First Bank has no effect on the direction of ICICI Lombard i.e., ICICI Lombard and IDFC First go up and down completely randomly.
Pair Corralation between ICICI Lombard and IDFC First
Assuming the 90 days trading horizon ICICI Lombard General is expected to generate 0.82 times more return on investment than IDFC First. However, ICICI Lombard General is 1.22 times less risky than IDFC First. It trades about 0.07 of its potential returns per unit of risk. IDFC First Bank is currently generating about 0.02 per unit of risk. If you would invest 121,186 in ICICI Lombard General on September 2, 2024 and sell it today you would earn a total of 64,999 from holding ICICI Lombard General or generate 53.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.59% |
| Values | Daily Returns |
ICICI Lombard General vs. IDFC First Bank
Performance |
| Timeline |
| ICICI Lombard General |
| IDFC First Bank |
ICICI Lombard and IDFC First Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICICI Lombard and IDFC First
The main advantage of trading using opposite ICICI Lombard and IDFC First positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICICI Lombard position performs unexpectedly, IDFC First 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 IDFC First will offset losses from the drop in IDFC First's long position.| ICICI Lombard vs. Ankit Metal Power | ICICI Lombard vs. Tips Music Limited | ICICI Lombard vs. Indian Metals Ferro | ICICI Lombard vs. Ratnamani Metals Tubes |
| IDFC First vs. Reliance Industries Limited | IDFC First vs. State Bank of | IDFC First vs. Oil Natural Gas |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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