Correlation Between ITI and Page Industries
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By analyzing existing cross correlation between ITI Limited and Page Industries Limited, you can compare the effects of market volatilities on ITI and Page 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 ITI with a short position of Page Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of ITI and Page Industries.
Diversification Opportunities for ITI and Page Industries
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ITI and Page is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding ITI Limited and Page Industries Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Page Industries and ITI 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 ITI Limited are associated (or correlated) with Page Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Page Industries has no effect on the direction of ITI i.e., ITI and Page Industries go up and down completely randomly.
Pair Corralation between ITI and Page Industries
Assuming the 90 days trading horizon ITI Limited is expected to generate 5.26 times more return on investment than Page Industries. However, ITI is 5.26 times more volatile than Page Industries Limited. It trades about 0.21 of its potential returns per unit of risk. Page Industries Limited is currently generating about 0.45 per unit of risk. If you would invest 29,218 in ITI Limited on September 20, 2024 and sell it today you would earn a total of 7,002 from holding ITI Limited or generate 23.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ITI Limited vs. Page Industries Limited
Performance |
| Timeline |
| ITI Limited |
| Page Industries |
ITI and Page Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ITI and Page Industries
The main advantage of trading using opposite ITI and Page Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ITI position performs unexpectedly, Page 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 Page Industries will offset losses from the drop in Page Industries' long position.The idea behind ITI Limited and Page Industries Limited pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Page Industries vs. KIOCL Limited | Page Industries vs. Spentex Industries Limited | Page Industries vs. Punjab Sind Bank | Page Industries vs. ITI 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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