Correlation Between India Glycols and BF Investment
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By analyzing existing cross correlation between India Glycols Limited and BF Investment Limited, you can compare the effects of market volatilities on India Glycols and BF Investment 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 India Glycols with a short position of BF Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of India Glycols and BF Investment.
Diversification Opportunities for India Glycols and BF Investment
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between India and BFINVEST is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding India Glycols Limited and BF Investment Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BF Investment Limited and India Glycols 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 India Glycols Limited are associated (or correlated) with BF Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BF Investment Limited has no effect on the direction of India Glycols i.e., India Glycols and BF Investment go up and down completely randomly.
Pair Corralation between India Glycols and BF Investment
Assuming the 90 days trading horizon India Glycols is expected to generate 1.84 times less return on investment than BF Investment. In addition to that, India Glycols is 1.1 times more volatile than BF Investment Limited. It trades about 0.11 of its total potential returns per unit of risk. BF Investment Limited is currently generating about 0.22 per unit of volatility. If you would invest 65,065 in BF Investment Limited on September 1, 2024 and sell it today you would earn a total of 8,215 from holding BF Investment Limited or generate 12.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
India Glycols Limited vs. BF Investment Limited
Performance |
| Timeline |
| India Glycols Limited |
| BF Investment Limited |
India Glycols and BF Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with India Glycols and BF Investment
The main advantage of trading using opposite India Glycols and BF Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if India Glycols position performs unexpectedly, BF Investment 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 BF Investment will offset losses from the drop in BF Investment's long position.| India Glycols vs. NMDC Limited | India Glycols vs. Steel Authority of | India Glycols vs. Embassy Office Parks | India Glycols vs. Gujarat Narmada Valley |
| BF Investment vs. Madhav Copper Limited | BF Investment vs. Neogen Chemicals Limited | BF Investment vs. Ratnamani Metals Tubes | BF Investment vs. Tips Music 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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