Correlation Between Indian Oil and Bkm Industries
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By analyzing existing cross correlation between Indian Oil and Bkm Industries Limited, you can compare the effects of market volatilities on Indian Oil and Bkm Industries 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 Oil with a short position of Bkm Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indian Oil and Bkm Industries.
Diversification Opportunities for Indian Oil and Bkm Industries
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Indian and Bkm is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Indian Oil and Bkm Industries Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bkm Industries and Indian Oil 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 Oil are associated (or correlated) with Bkm Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bkm Industries has no effect on the direction of Indian Oil i.e., Indian Oil and Bkm Industries go up and down completely randomly.
Pair Corralation between Indian Oil and Bkm Industries
Assuming the 90 days trading horizon Indian Oil is expected to generate 14.08 times less return on investment than Bkm Industries. But when comparing it to its historical volatility, Indian Oil is 20.96 times less risky than Bkm Industries. It trades about 0.07 of its potential returns per unit of risk. Bkm Industries Limited is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 120.00 in Bkm Industries Limited on September 22, 2024 and sell it today you would earn a total of 4,380 from holding Bkm Industries Limited or generate 3650.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 93.87% |
| Values | Daily Returns |
Indian Oil vs. Bkm Industries Limited
Performance |
| Timeline |
| Indian Oil |
| Bkm Industries |
Indian Oil and Bkm Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indian Oil and Bkm Industries
The main advantage of trading using opposite Indian Oil and Bkm Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indian Oil position performs unexpectedly, Bkm Industries 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 Bkm Industries will offset losses from the drop in Bkm Industries' long position.| Indian Oil vs. Paramount Communications Limited | Indian Oil vs. Transport of | Indian Oil vs. Nucleus Software Exports | Indian Oil vs. Compucom Software Limited |
| Bkm Industries vs. NMDC Limited | Bkm Industries vs. Steel Authority of | Bkm Industries vs. Embassy Office Parks | Bkm Industries vs. Gujarat Narmada Valley |
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 CEOs Directory module to screen CEOs from public companies around the world.
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