Correlation Between ITTEFAQ Iron and AKD Hospitality
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By analyzing existing cross correlation between ITTEFAQ Iron Industries and AKD Hospitality, you can compare the effects of market volatilities on ITTEFAQ Iron and AKD Hospitality 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 ITTEFAQ Iron with a short position of AKD Hospitality. Check out your portfolio center. Please also check ongoing floating volatility patterns of ITTEFAQ Iron and AKD Hospitality.
Diversification Opportunities for ITTEFAQ Iron and AKD Hospitality
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ITTEFAQ and AKD is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding ITTEFAQ Iron Industries and AKD Hospitality in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AKD Hospitality and ITTEFAQ Iron 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 ITTEFAQ Iron Industries are associated (or correlated) with AKD Hospitality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AKD Hospitality has no effect on the direction of ITTEFAQ Iron i.e., ITTEFAQ Iron and AKD Hospitality go up and down completely randomly.
Pair Corralation between ITTEFAQ Iron and AKD Hospitality
Assuming the 90 days trading horizon ITTEFAQ Iron Industries is expected to generate 1.02 times more return on investment than AKD Hospitality. However, ITTEFAQ Iron is 1.02 times more volatile than AKD Hospitality. It trades about 0.04 of its potential returns per unit of risk. AKD Hospitality is currently generating about 0.04 per unit of risk. If you would invest 529.00 in ITTEFAQ Iron Industries on November 5, 2024 and sell it today you would earn a total of 256.00 from holding ITTEFAQ Iron Industries or generate 48.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 73.03% |
| Values | Daily Returns |
ITTEFAQ Iron Industries vs. AKD Hospitality
Performance |
| Timeline |
| ITTEFAQ Iron Industries |
| AKD Hospitality |
ITTEFAQ Iron and AKD Hospitality Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ITTEFAQ Iron and AKD Hospitality
The main advantage of trading using opposite ITTEFAQ Iron and AKD Hospitality positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ITTEFAQ Iron position performs unexpectedly, AKD Hospitality 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 AKD Hospitality will offset losses from the drop in AKD Hospitality's long position.| ITTEFAQ Iron vs. JS Investments | ITTEFAQ Iron vs. Ghani Chemical Industries | ITTEFAQ Iron vs. Nimir Industrial Chemical | ITTEFAQ Iron vs. Pakistan Telecommunication |
| AKD Hospitality vs. Sitara Chemical Industries | AKD Hospitality vs. NetSol Technologies | AKD Hospitality vs. Ghani Chemical Industries | AKD Hospitality vs. Jubilee Life Insurance |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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