Correlation Between Imagicaaworld Entertainment and Cantabil Retail
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By analyzing existing cross correlation between Imagicaaworld Entertainment Limited and Cantabil Retail India, you can compare the effects of market volatilities on Imagicaaworld Entertainment and Cantabil Retail 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 Imagicaaworld Entertainment with a short position of Cantabil Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Imagicaaworld Entertainment and Cantabil Retail.
Diversification Opportunities for Imagicaaworld Entertainment and Cantabil Retail
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Imagicaaworld and Cantabil is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Imagicaaworld Entertainment Li and Cantabil Retail India in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cantabil Retail India and Imagicaaworld Entertainment 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 Imagicaaworld Entertainment Limited are associated (or correlated) with Cantabil Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cantabil Retail India has no effect on the direction of Imagicaaworld Entertainment i.e., Imagicaaworld Entertainment and Cantabil Retail go up and down completely randomly.
Pair Corralation between Imagicaaworld Entertainment and Cantabil Retail
Assuming the 90 days trading horizon Imagicaaworld Entertainment is expected to generate 4.02 times less return on investment than Cantabil Retail. In addition to that, Imagicaaworld Entertainment is 1.01 times more volatile than Cantabil Retail India. It trades about 0.02 of its total potential returns per unit of risk. Cantabil Retail India is currently generating about 0.07 per unit of volatility. If you would invest 18,952 in Cantabil Retail India on September 2, 2024 and sell it today you would earn a total of 3,983 from holding Cantabil Retail India or generate 21.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Imagicaaworld Entertainment Li vs. Cantabil Retail India
Performance |
| Timeline |
| Imagicaaworld Entertainment |
| Cantabil Retail India |
Imagicaaworld Entertainment and Cantabil Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Imagicaaworld Entertainment and Cantabil Retail
The main advantage of trading using opposite Imagicaaworld Entertainment and Cantabil Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Imagicaaworld Entertainment position performs unexpectedly, Cantabil Retail 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 Cantabil Retail will offset losses from the drop in Cantabil Retail's long position.The idea behind Imagicaaworld Entertainment Limited and Cantabil Retail India pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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