Correlation Between Kohinoor Foods and ADF Foods
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By analyzing existing cross correlation between Kohinoor Foods Limited and ADF Foods Limited, you can compare the effects of market volatilities on Kohinoor Foods and ADF Foods 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 Kohinoor Foods with a short position of ADF Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kohinoor Foods and ADF Foods.
Diversification Opportunities for Kohinoor Foods and ADF Foods
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kohinoor and ADF is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Kohinoor Foods Limited and ADF Foods Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADF Foods Limited and Kohinoor Foods 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 Kohinoor Foods Limited are associated (or correlated) with ADF Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADF Foods Limited has no effect on the direction of Kohinoor Foods i.e., Kohinoor Foods and ADF Foods go up and down completely randomly.
Pair Corralation between Kohinoor Foods and ADF Foods
Assuming the 90 days trading horizon Kohinoor Foods is expected to generate 17.1 times less return on investment than ADF Foods. But when comparing it to its historical volatility, Kohinoor Foods Limited is 6.73 times less risky than ADF Foods. It trades about 0.02 of its potential returns per unit of risk. ADF Foods Limited is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 18,421 in ADF Foods Limited on September 2, 2024 and sell it today you would earn a total of 14,844 from holding ADF Foods Limited or generate 80.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.46% |
| Values | Daily Returns |
Kohinoor Foods Limited vs. ADF Foods Limited
Performance |
| Timeline |
| Kohinoor Foods |
| ADF Foods Limited |
Kohinoor Foods and ADF Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kohinoor Foods and ADF Foods
The main advantage of trading using opposite Kohinoor Foods and ADF Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kohinoor Foods position performs unexpectedly, ADF Foods 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 ADF Foods will offset losses from the drop in ADF Foods' long position.| Kohinoor Foods vs. Asian Hotels Limited | Kohinoor Foods vs. Blue Coast Hotels | Kohinoor Foods vs. Associated Alcohols Breweries | Kohinoor Foods vs. VIP Clothing Limited |
| ADF Foods vs. Kingfa Science Technology | ADF Foods vs. Rico Auto Industries | ADF Foods vs. GACM Technologies Limited | ADF Foods vs. COSMO FIRST 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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