Correlation Between Lakshmi Finance and Anup Engineering
Can any of the company-specific risk be diversified away by investing in both Lakshmi Finance and Anup Engineering at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Lakshmi Finance and Anup Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lakshmi Finance Industrial and The Anup Engineering, you can compare the effects of market volatilities on Lakshmi Finance and Anup Engineering 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 Lakshmi Finance with a short position of Anup Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lakshmi Finance and Anup Engineering.
Diversification Opportunities for Lakshmi Finance and Anup Engineering
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lakshmi and Anup is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Lakshmi Finance Industrial and The Anup Engineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anup Engineering and Lakshmi Finance 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 Lakshmi Finance Industrial are associated (or correlated) with Anup Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anup Engineering has no effect on the direction of Lakshmi Finance i.e., Lakshmi Finance and Anup Engineering go up and down completely randomly.
Pair Corralation between Lakshmi Finance and Anup Engineering
Assuming the 90 days trading horizon Lakshmi Finance Industrial is expected to under-perform the Anup Engineering. But the stock apears to be less risky and, when comparing its historical volatility, Lakshmi Finance Industrial is 2.41 times less risky than Anup Engineering. The stock trades about -0.21 of its potential returns per unit of risk. The The Anup Engineering is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 348,160 in The Anup Engineering on September 2, 2024 and sell it today you would earn a total of 17,355 from holding The Anup Engineering or generate 4.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lakshmi Finance Industrial vs. The Anup Engineering
Performance |
| Timeline |
| Lakshmi Finance Indu |
| Anup Engineering |
Lakshmi Finance and Anup Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lakshmi Finance and Anup Engineering
The main advantage of trading using opposite Lakshmi Finance and Anup Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lakshmi Finance position performs unexpectedly, Anup Engineering 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 Anup Engineering will offset losses from the drop in Anup Engineering's long position.| Lakshmi Finance vs. Kingfa Science Technology | Lakshmi Finance vs. Rico Auto Industries | Lakshmi Finance vs. GACM Technologies Limited | Lakshmi Finance vs. COSMO FIRST LIMITED |
| Anup Engineering vs. Ratnamani Metals Tubes | Anup Engineering vs. Lakshmi Finance Industrial | Anup Engineering vs. Indian Metals Ferro | Anup Engineering vs. Avonmore Capital Management |
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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