Correlation Between Investcorp India and BRC
Can any of the company-specific risk be diversified away by investing in both Investcorp India and BRC at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Investcorp India and BRC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Investcorp India Acquisition and BRC Inc, you can compare the effects of market volatilities on Investcorp India and BRC 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 Investcorp India with a short position of BRC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Investcorp India and BRC.
Diversification Opportunities for Investcorp India and BRC
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Investcorp and BRC is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Investcorp India Acquisition and BRC Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BRC Inc and Investcorp India 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 Investcorp India Acquisition are associated (or correlated) with BRC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BRC Inc has no effect on the direction of Investcorp India i.e., Investcorp India and BRC go up and down completely randomly.
Pair Corralation between Investcorp India and BRC
Assuming the 90 days horizon Investcorp India Acquisition is expected to generate 0.13 times more return on investment than BRC. However, Investcorp India Acquisition is 7.96 times less risky than BRC. It trades about 0.06 of its potential returns per unit of risk. BRC Inc is currently generating about -0.02 per unit of risk. If you would invest 1,096 in Investcorp India Acquisition on November 5, 2024 and sell it today you would earn a total of 90.00 from holding Investcorp India Acquisition or generate 8.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Investcorp India Acquisition vs. BRC Inc
Performance |
| Timeline |
| Investcorp India Acq |
| BRC Inc |
Investcorp India and BRC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Investcorp India and BRC
The main advantage of trading using opposite Investcorp India and BRC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Investcorp India position performs unexpectedly, BRC 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 BRC will offset losses from the drop in BRC's long position.| Investcorp India vs. Fernhill Beverage | Investcorp India vs. Teleflex Incorporated | Investcorp India vs. HUTCHMED DRC | Investcorp India vs. Paranovus Entertainment Technology |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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