Correlation Between KNR Constructions and Power Finance
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By analyzing existing cross correlation between KNR Constructions Limited and Power Finance, you can compare the effects of market volatilities on KNR Constructions and Power Finance 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 KNR Constructions with a short position of Power Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of KNR Constructions and Power Finance.
Diversification Opportunities for KNR Constructions and Power Finance
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between KNR and Power is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding KNR Constructions Limited and Power Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Power Finance and KNR Constructions 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 KNR Constructions Limited are associated (or correlated) with Power Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Power Finance has no effect on the direction of KNR Constructions i.e., KNR Constructions and Power Finance go up and down completely randomly.
Pair Corralation between KNR Constructions and Power Finance
Assuming the 90 days trading horizon KNR Constructions Limited is expected to under-perform the Power Finance. But the stock apears to be less risky and, when comparing its historical volatility, KNR Constructions Limited is 1.65 times less risky than Power Finance. The stock trades about -0.46 of its potential returns per unit of risk. The Power Finance is currently generating about -0.17 of returns per unit of risk over similar time horizon. If you would invest 44,850 in Power Finance on November 1, 2024 and sell it today you would lose (4,940) from holding Power Finance or give up 11.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KNR Constructions Limited vs. Power Finance
Performance |
| Timeline |
| KNR Constructions |
| Power Finance |
KNR Constructions and Power Finance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KNR Constructions and Power Finance
The main advantage of trading using opposite KNR Constructions and Power Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KNR Constructions position performs unexpectedly, Power Finance 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 Power Finance will offset losses from the drop in Power Finance's long position.| KNR Constructions vs. Samhi Hotels Limited | KNR Constructions vs. Kamat Hotels Limited | KNR Constructions vs. Ravi Kumar Distilleries | KNR Constructions vs. Blue Coast Hotels |
| Power Finance vs. GM Breweries Limited | Power Finance vs. Hemisphere Properties India | Power Finance vs. KNR Constructions Limited | Power Finance vs. Gallantt Ispat 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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