Correlation Between KNR Constructions and SAL Steel
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By analyzing existing cross correlation between KNR Constructions Limited and SAL Steel Limited, you can compare the effects of market volatilities on KNR Constructions and SAL Steel 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 SAL Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of KNR Constructions and SAL Steel.
Diversification Opportunities for KNR Constructions and SAL Steel
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between KNR and SAL is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding KNR Constructions Limited and SAL Steel Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAL Steel Limited 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 SAL Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAL Steel Limited has no effect on the direction of KNR Constructions i.e., KNR Constructions and SAL Steel go up and down completely randomly.
Pair Corralation between KNR Constructions and SAL Steel
Assuming the 90 days trading horizon KNR Constructions Limited is expected to generate 0.9 times more return on investment than SAL Steel. However, KNR Constructions Limited is 1.12 times less risky than SAL Steel. It trades about 0.02 of its potential returns per unit of risk. SAL Steel Limited is currently generating about 0.01 per unit of risk. If you would invest 27,120 in KNR Constructions Limited on November 1, 2024 and sell it today you would earn a total of 1,885 from holding KNR Constructions Limited or generate 6.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KNR Constructions Limited vs. SAL Steel Limited
Performance |
| Timeline |
| KNR Constructions |
| SAL Steel Limited |
KNR Constructions and SAL Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KNR Constructions and SAL Steel
The main advantage of trading using opposite KNR Constructions and SAL Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KNR Constructions position performs unexpectedly, SAL Steel 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 SAL Steel will offset losses from the drop in SAL Steel'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 |
| SAL Steel vs. KNR Constructions Limited | SAL Steel vs. Oriental Hotels Limited | SAL Steel vs. Juniper Hotels | SAL Steel vs. Rajnandini Metal 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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