Correlation Between Kohinoor Foods and Cambridge Technology
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By analyzing existing cross correlation between Kohinoor Foods Limited and Cambridge Technology Enterprises, you can compare the effects of market volatilities on Kohinoor Foods and Cambridge Technology 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 Cambridge Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kohinoor Foods and Cambridge Technology.
Diversification Opportunities for Kohinoor Foods and Cambridge Technology
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kohinoor and Cambridge is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Kohinoor Foods Limited and Cambridge Technology Enterpris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambridge Technology 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 Cambridge Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambridge Technology has no effect on the direction of Kohinoor Foods i.e., Kohinoor Foods and Cambridge Technology go up and down completely randomly.
Pair Corralation between Kohinoor Foods and Cambridge Technology
Assuming the 90 days trading horizon Kohinoor Foods Limited is expected to generate 1.2 times more return on investment than Cambridge Technology. However, Kohinoor Foods is 1.2 times more volatile than Cambridge Technology Enterprises. It trades about -0.04 of its potential returns per unit of risk. Cambridge Technology Enterprises is currently generating about -0.58 per unit of risk. If you would invest 3,490 in Kohinoor Foods Limited on December 16, 2024 and sell it today you would lose (199.00) from holding Kohinoor Foods Limited or give up 5.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kohinoor Foods Limited vs. Cambridge Technology Enterpris
Performance |
| Timeline |
| Kohinoor Foods |
| Cambridge Technology |
Kohinoor Foods and Cambridge Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kohinoor Foods and Cambridge Technology
The main advantage of trading using opposite Kohinoor Foods and Cambridge Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kohinoor Foods position performs unexpectedly, Cambridge Technology 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 Cambridge Technology will offset losses from the drop in Cambridge Technology's long position.| Kohinoor Foods vs. TECIL Chemicals and | ||
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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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