Correlation Between Kotak Mahindra and Kalyani Steels
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By analyzing existing cross correlation between Kotak Mahindra Bank and Kalyani Steels Limited, you can compare the effects of market volatilities on Kotak Mahindra and Kalyani Steels 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 Kalyani Steels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kotak Mahindra and Kalyani Steels.
Diversification Opportunities for Kotak Mahindra and Kalyani Steels
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kotak and Kalyani is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Kotak Mahindra Bank and Kalyani Steels Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kalyani Steels 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 Kalyani Steels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kalyani Steels has no effect on the direction of Kotak Mahindra i.e., Kotak Mahindra and Kalyani Steels go up and down completely randomly.
Pair Corralation between Kotak Mahindra and Kalyani Steels
Assuming the 90 days trading horizon Kotak Mahindra Bank is expected to generate 0.92 times more return on investment than Kalyani Steels. However, Kotak Mahindra Bank is 1.09 times less risky than Kalyani Steels. It trades about 0.13 of its potential returns per unit of risk. Kalyani Steels Limited is currently generating about -0.51 per unit of risk. If you would invest 178,500 in Kotak Mahindra Bank on November 1, 2024 and sell it today you would earn a total of 11,650 from holding Kotak Mahindra Bank or generate 6.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Kotak Mahindra Bank vs. Kalyani Steels Limited
Performance |
| Timeline |
| Kotak Mahindra Bank |
| Kalyani Steels |
Kotak Mahindra and Kalyani Steels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kotak Mahindra and Kalyani Steels
The main advantage of trading using opposite Kotak Mahindra and Kalyani Steels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kotak Mahindra position performs unexpectedly, Kalyani Steels 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 Kalyani Steels will offset losses from the drop in Kalyani Steels' long position.| Kotak Mahindra vs. LT Foods Limited | Kotak Mahindra vs. Teamlease Services Limited | Kotak Mahindra vs. Foods Inns Limited | Kotak Mahindra vs. Megastar Foods Limited |
| Kalyani Steels vs. Kotak Mahindra Bank | Kalyani Steels vs. ideaForge Technology Limited | Kalyani Steels vs. Salzer Electronics Limited | Kalyani Steels vs. Cambridge Technology Enterprises |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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