Correlation Between Industrial Investment and Prakash Steelage
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By analyzing existing cross correlation between Industrial Investment Trust and Prakash Steelage Limited, you can compare the effects of market volatilities on Industrial Investment and Prakash Steelage 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 Industrial Investment with a short position of Prakash Steelage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial Investment and Prakash Steelage.
Diversification Opportunities for Industrial Investment and Prakash Steelage
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Industrial and Prakash is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Industrial Investment Trust and Prakash Steelage Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prakash Steelage and Industrial Investment 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 Industrial Investment Trust are associated (or correlated) with Prakash Steelage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prakash Steelage has no effect on the direction of Industrial Investment i.e., Industrial Investment and Prakash Steelage go up and down completely randomly.
Pair Corralation between Industrial Investment and Prakash Steelage
Assuming the 90 days trading horizon Industrial Investment Trust is expected to generate 1.02 times more return on investment than Prakash Steelage. However, Industrial Investment is 1.02 times more volatile than Prakash Steelage Limited. It trades about 0.11 of its potential returns per unit of risk. Prakash Steelage Limited is currently generating about 0.05 per unit of risk. If you would invest 8,440 in Industrial Investment Trust on September 21, 2024 and sell it today you would earn a total of 30,725 from holding Industrial Investment Trust or generate 364.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.59% |
| Values | Daily Returns |
Industrial Investment Trust vs. Prakash Steelage Limited
Performance |
| Timeline |
| Industrial Investment |
| Prakash Steelage |
Industrial Investment and Prakash Steelage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial Investment and Prakash Steelage
The main advantage of trading using opposite Industrial Investment and Prakash Steelage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial Investment position performs unexpectedly, Prakash Steelage 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 Prakash Steelage will offset losses from the drop in Prakash Steelage's long position.| Industrial Investment vs. Samhi Hotels Limited | Industrial Investment vs. Apollo Sindoori Hotels | Industrial Investment vs. Viceroy Hotels Limited | Industrial Investment vs. SINCLAIRS HOTELS ORD |
| Prakash Steelage vs. Tamilnad Mercantile Bank | Prakash Steelage vs. DCM Financial Services | Prakash Steelage vs. Apex Frozen Foods | Prakash Steelage vs. Sapphire Foods India |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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