Correlation Between Indian Railway and Global Health
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By analyzing existing cross correlation between Indian Railway Finance and Global Health Limited, you can compare the effects of market volatilities on Indian Railway and Global Health 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 Railway with a short position of Global Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indian Railway and Global Health.
Diversification Opportunities for Indian Railway and Global Health
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Indian and Global is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Indian Railway Finance and Global Health Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Health Limited and Indian Railway 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 Railway Finance are associated (or correlated) with Global Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Health Limited has no effect on the direction of Indian Railway i.e., Indian Railway and Global Health go up and down completely randomly.
Pair Corralation between Indian Railway and Global Health
Assuming the 90 days trading horizon Indian Railway Finance is expected to under-perform the Global Health. In addition to that, Indian Railway is 1.39 times more volatile than Global Health Limited. It trades about -0.03 of its total potential returns per unit of risk. Global Health Limited is currently generating about 0.07 per unit of volatility. If you would invest 102,255 in Global Health Limited on August 30, 2024 and sell it today you would earn a total of 5,400 from holding Global Health Limited or generate 5.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Indian Railway Finance vs. Global Health Limited
Performance |
| Timeline |
| Indian Railway Finance |
| Global Health Limited |
Indian Railway and Global Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indian Railway and Global Health
The main advantage of trading using opposite Indian Railway and Global Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indian Railway position performs unexpectedly, Global Health 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 Global Health will offset losses from the drop in Global Health's long position.| Indian Railway vs. Varun Beverages Limited | Indian Railway vs. Entero Healthcare Solutions | Indian Railway vs. Associated Alcohols Breweries | Indian Railway vs. Lotus Eye Hospital |
| Global Health vs. Mtar Technologies Limited | Global Health vs. Som Distilleries Breweries | Global Health vs. Kilitch Drugs Limited | Global Health vs. Datamatics Global Services |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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