Correlation Between LT Foods and Electronics Mart
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By analyzing existing cross correlation between LT Foods Limited and Electronics Mart India, you can compare the effects of market volatilities on LT Foods and Electronics Mart 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 LT Foods with a short position of Electronics Mart. Check out your portfolio center. Please also check ongoing floating volatility patterns of LT Foods and Electronics Mart.
Diversification Opportunities for LT Foods and Electronics Mart
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between LTFOODS and Electronics is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding LT Foods Limited and Electronics Mart India in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electronics Mart India and LT 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 LT Foods Limited are associated (or correlated) with Electronics Mart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electronics Mart India has no effect on the direction of LT Foods i.e., LT Foods and Electronics Mart go up and down completely randomly.
Pair Corralation between LT Foods and Electronics Mart
Assuming the 90 days trading horizon LT Foods Limited is expected to generate 1.08 times more return on investment than Electronics Mart. However, LT Foods is 1.08 times more volatile than Electronics Mart India. It trades about 0.11 of its potential returns per unit of risk. Electronics Mart India is currently generating about -0.03 per unit of risk. If you would invest 19,550 in LT Foods Limited on August 28, 2024 and sell it today you would earn a total of 15,915 from holding LT Foods Limited or generate 81.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.51% |
| Values | Daily Returns |
LT Foods Limited vs. Electronics Mart India
Performance |
| Timeline |
| LT Foods Limited |
| Electronics Mart India |
LT Foods and Electronics Mart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LT Foods and Electronics Mart
The main advantage of trading using opposite LT Foods and Electronics Mart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LT Foods position performs unexpectedly, Electronics Mart 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 Electronics Mart will offset losses from the drop in Electronics Mart's long position.| LT Foods vs. SINCLAIRS HOTELS ORD | LT Foods vs. Dharani SugarsChemicals Limited | LT Foods vs. Royal Orchid Hotels | LT Foods vs. Sukhjit Starch Chemicals |
| Electronics Mart vs. Pilani Investment and | Electronics Mart vs. Baazar Style Retail | Electronics Mart vs. Kalyani Investment | Electronics Mart vs. Tata Investment |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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