Correlation Between ICICI Securities and UCO Bank
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By analyzing existing cross correlation between ICICI Securities Limited and UCO Bank, you can compare the effects of market volatilities on ICICI Securities and UCO Bank 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 ICICI Securities with a short position of UCO Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICICI Securities and UCO Bank.
Diversification Opportunities for ICICI Securities and UCO Bank
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ICICI and UCO is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding ICICI Securities Limited and UCO Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UCO Bank and ICICI Securities 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 ICICI Securities Limited are associated (or correlated) with UCO Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UCO Bank has no effect on the direction of ICICI Securities i.e., ICICI Securities and UCO Bank go up and down completely randomly.
Pair Corralation between ICICI Securities and UCO Bank
Assuming the 90 days trading horizon ICICI Securities Limited is expected to under-perform the UCO Bank. But the stock apears to be less risky and, when comparing its historical volatility, ICICI Securities Limited is 4.2 times less risky than UCO Bank. The stock trades about -0.14 of its potential returns per unit of risk. The UCO Bank is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 4,524 in UCO Bank on October 20, 2024 and sell it today you would lose (217.00) from holding UCO Bank or give up 4.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ICICI Securities Limited vs. UCO Bank
Performance |
| Timeline |
| ICICI Securities |
| UCO Bank |
ICICI Securities and UCO Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICICI Securities and UCO Bank
The main advantage of trading using opposite ICICI Securities and UCO Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICICI Securities position performs unexpectedly, UCO Bank 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 UCO Bank will offset losses from the drop in UCO Bank's long position.| ICICI Securities vs. Kingfa Science Technology | ICICI Securities vs. Rico Auto Industries | ICICI Securities vs. GACM Technologies Limited | ICICI Securities vs. COSMO FIRST LIMITED |
| UCO Bank vs. ADF Foods Limited | UCO Bank vs. Sapphire Foods India | UCO Bank vs. Varun Beverages Limited | UCO Bank vs. Bikaji Foods International |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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