Correlation Between Indian Metals and Agarwal Industrial
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By analyzing existing cross correlation between Indian Metals Ferro and Agarwal Industrial, you can compare the effects of market volatilities on Indian Metals and Agarwal Industrial 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 Indian Metals with a short position of Agarwal Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indian Metals and Agarwal Industrial.
Diversification Opportunities for Indian Metals and Agarwal Industrial
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Indian and Agarwal is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Indian Metals Ferro and Agarwal Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agarwal Industrial and Indian Metals 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 Indian Metals Ferro are associated (or correlated) with Agarwal Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agarwal Industrial has no effect on the direction of Indian Metals i.e., Indian Metals and Agarwal Industrial go up and down completely randomly.
Pair Corralation between Indian Metals and Agarwal Industrial
Assuming the 90 days trading horizon Indian Metals Ferro is expected to generate 1.31 times more return on investment than Agarwal Industrial. However, Indian Metals is 1.31 times more volatile than Agarwal Industrial. It trades about 0.43 of its potential returns per unit of risk. Agarwal Industrial is currently generating about 0.03 per unit of risk. If you would invest 64,312 in Indian Metals Ferro on August 28, 2024 and sell it today you would earn a total of 17,293 from holding Indian Metals Ferro or generate 26.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Indian Metals Ferro vs. Agarwal Industrial
Performance |
| Timeline |
| Indian Metals Ferro |
| Agarwal Industrial |
Indian Metals and Agarwal Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indian Metals and Agarwal Industrial
The main advantage of trading using opposite Indian Metals and Agarwal Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indian Metals position performs unexpectedly, Agarwal Industrial 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 Agarwal Industrial will offset losses from the drop in Agarwal Industrial's long position.| Indian Metals vs. NMDC Limited | Indian Metals vs. Steel Authority of | Indian Metals vs. Embassy Office Parks | Indian Metals vs. Gujarat Narmada Valley |
| Agarwal Industrial vs. ADF Foods Limited | Agarwal Industrial vs. Total Transport Systems | Agarwal Industrial vs. Jindal Drilling And | Agarwal Industrial vs. Jubilant Foodworks 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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