Correlation Between Indian Metals and India Glycols
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By analyzing existing cross correlation between Indian Metals Ferro and India Glycols Limited, you can compare the effects of market volatilities on Indian Metals and India Glycols 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 India Glycols. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indian Metals and India Glycols.
Diversification Opportunities for Indian Metals and India Glycols
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Indian and India is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Indian Metals Ferro and India Glycols Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on India Glycols Limited 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 India Glycols. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of India Glycols Limited has no effect on the direction of Indian Metals i.e., Indian Metals and India Glycols go up and down completely randomly.
Pair Corralation between Indian Metals and India Glycols
Assuming the 90 days trading horizon Indian Metals Ferro is expected to generate 1.12 times more return on investment than India Glycols. However, Indian Metals is 1.12 times more volatile than India Glycols Limited. It trades about 0.1 of its potential returns per unit of risk. India Glycols Limited is currently generating about 0.07 per unit of risk. If you would invest 38,475 in Indian Metals Ferro on August 25, 2024 and sell it today you would earn a total of 44,120 from holding Indian Metals Ferro or generate 114.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.65% |
| Values | Daily Returns |
Indian Metals Ferro vs. India Glycols Limited
Performance |
| Timeline |
| Indian Metals Ferro |
| India Glycols Limited |
Indian Metals and India Glycols Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indian Metals and India Glycols
The main advantage of trading using opposite Indian Metals and India Glycols positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indian Metals position performs unexpectedly, India Glycols 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 India Glycols will offset losses from the drop in India Glycols' long position.| Indian Metals vs. Rainbow Childrens Medicare | Indian Metals vs. The Federal Bank | Indian Metals vs. Generic Engineering Construction | Indian Metals vs. Garuda Construction Engineering |
| India Glycols vs. Future Retail Limited | India Glycols vs. MIC Electronics Limited | India Glycols vs. Global Education Limited | India Glycols vs. Garuda Construction Engineering |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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