Correlation Between ICICI Lombard and KEC International
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By analyzing existing cross correlation between ICICI Lombard General and KEC International Limited, you can compare the effects of market volatilities on ICICI Lombard and KEC International 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 KEC International. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICICI Lombard and KEC International.
Diversification Opportunities for ICICI Lombard and KEC International
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ICICI and KEC is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding ICICI Lombard General and KEC International Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KEC International 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 KEC International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KEC International has no effect on the direction of ICICI Lombard i.e., ICICI Lombard and KEC International go up and down completely randomly.
Pair Corralation between ICICI Lombard and KEC International
Assuming the 90 days trading horizon ICICI Lombard General is expected to under-perform the KEC International. But the stock apears to be less risky and, when comparing its historical volatility, ICICI Lombard General is 2.0 times less risky than KEC International. The stock trades about -0.19 of its potential returns per unit of risk. The KEC International Limited is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 92,600 in KEC International Limited on August 31, 2024 and sell it today you would earn a total of 12,705 from holding KEC International Limited or generate 13.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.39% |
| Values | Daily Returns |
ICICI Lombard General vs. KEC International Limited
Performance |
| Timeline |
| ICICI Lombard General |
| KEC International |
ICICI Lombard and KEC International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICICI Lombard and KEC International
The main advantage of trading using opposite ICICI Lombard and KEC International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICICI Lombard position performs unexpectedly, KEC International 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 KEC International will offset losses from the drop in KEC International'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 |
| KEC International vs. Palred Technologies Limited | KEC International vs. FCS Software Solutions | KEC International vs. Newgen Software Technologies | KEC International vs. VA Tech Wabag |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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