Correlation Between Indian Oil and COSMO FIRST
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By analyzing existing cross correlation between Indian Oil and COSMO FIRST LIMITED, you can compare the effects of market volatilities on Indian Oil and COSMO FIRST 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 COSMO FIRST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indian Oil and COSMO FIRST.
Diversification Opportunities for Indian Oil and COSMO FIRST
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Indian and COSMO is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Indian Oil and COSMO FIRST LIMITED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COSMO FIRST LIMITED 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 COSMO FIRST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COSMO FIRST LIMITED has no effect on the direction of Indian Oil i.e., Indian Oil and COSMO FIRST go up and down completely randomly.
Pair Corralation between Indian Oil and COSMO FIRST
Assuming the 90 days trading horizon Indian Oil is expected to generate 0.61 times more return on investment than COSMO FIRST. However, Indian Oil is 1.64 times less risky than COSMO FIRST. It trades about -0.14 of its potential returns per unit of risk. COSMO FIRST LIMITED is currently generating about -0.32 per unit of risk. If you would invest 13,805 in Indian Oil on November 4, 2024 and sell it today you would lose (956.00) from holding Indian Oil or give up 6.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Indian Oil vs. COSMO FIRST LIMITED
Performance |
| Timeline |
| Indian Oil |
| COSMO FIRST LIMITED |
Indian Oil and COSMO FIRST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indian Oil and COSMO FIRST
The main advantage of trading using opposite Indian Oil and COSMO FIRST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indian Oil position performs unexpectedly, COSMO FIRST 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 COSMO FIRST will offset losses from the drop in COSMO FIRST's long position.| Indian Oil vs. Praxis Home Retail | Indian Oil vs. Transport of | Indian Oil vs. Vidhi Specialty Food | Indian Oil vs. Jayant Agro Organics |
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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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