Correlation Between Kotak Mahindra and JSW Energy
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By analyzing existing cross correlation between Kotak Mahindra Bank and JSW Energy Limited, you can compare the effects of market volatilities on Kotak Mahindra and JSW Energy 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 Kotak Mahindra with a short position of JSW Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kotak Mahindra and JSW Energy.
Diversification Opportunities for Kotak Mahindra and JSW Energy
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kotak and JSW is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Kotak Mahindra Bank and JSW Energy Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JSW Energy Limited and Kotak Mahindra 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 Kotak Mahindra Bank are associated (or correlated) with JSW Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JSW Energy Limited has no effect on the direction of Kotak Mahindra i.e., Kotak Mahindra and JSW Energy go up and down completely randomly.
Pair Corralation between Kotak Mahindra and JSW Energy
Assuming the 90 days trading horizon Kotak Mahindra is expected to generate 2.35 times less return on investment than JSW Energy. But when comparing it to its historical volatility, Kotak Mahindra Bank is 1.88 times less risky than JSW Energy. It trades about 0.02 of its potential returns per unit of risk. JSW Energy Limited is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 47,190 in JSW Energy Limited on November 9, 2024 and sell it today you would earn a total of 2,230 from holding JSW Energy Limited or generate 4.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.24% |
| Values | Daily Returns |
Kotak Mahindra Bank vs. JSW Energy Limited
Performance |
| Timeline |
| Kotak Mahindra Bank |
| JSW Energy Limited |
Kotak Mahindra and JSW Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kotak Mahindra and JSW Energy
The main advantage of trading using opposite Kotak Mahindra and JSW Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kotak Mahindra position performs unexpectedly, JSW Energy 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 JSW Energy will offset losses from the drop in JSW Energy's long position.| Kotak Mahindra vs. Mahamaya Steel Industries | Kotak Mahindra vs. Credo Brands Marketing | Kotak Mahindra vs. Vardhman Special Steels | Kotak Mahindra vs. Zenith Steel Pipes |
| JSW Energy vs. Allied Blenders Distillers | JSW Energy vs. General Insurance | JSW Energy vs. Tamilnad Mercantile Bank | JSW Energy vs. Jindal Drilling And |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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