Correlation Between Bank of Maharashtra and Bandhan Bank
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By analyzing existing cross correlation between Bank of Maharashtra and Bandhan Bank Limited, you can compare the effects of market volatilities on Bank of Maharashtra and Bandhan Bank 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 Bank of Maharashtra with a short position of Bandhan Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Maharashtra and Bandhan Bank.
Diversification Opportunities for Bank of Maharashtra and Bandhan Bank
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Bank and Bandhan is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Maharashtra and Bandhan Bank Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bandhan Bank Limited and Bank of Maharashtra 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 Bank of Maharashtra are associated (or correlated) with Bandhan Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bandhan Bank Limited has no effect on the direction of Bank of Maharashtra i.e., Bank of Maharashtra and Bandhan Bank go up and down completely randomly.
Pair Corralation between Bank of Maharashtra and Bandhan Bank
Assuming the 90 days trading horizon Bank of Maharashtra is expected to under-perform the Bandhan Bank. But the stock apears to be less risky and, when comparing its historical volatility, Bank of Maharashtra is 1.2 times less risky than Bandhan Bank. The stock trades about -0.21 of its potential returns per unit of risk. The Bandhan Bank Limited is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 14,825 in Bandhan Bank Limited on December 1, 2024 and sell it today you would lose (706.00) from holding Bandhan Bank Limited or give up 4.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of Maharashtra vs. Bandhan Bank Limited
Performance |
| Timeline |
| Bank of Maharashtra |
| Bandhan Bank Limited |
Bank of Maharashtra and Bandhan Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Maharashtra and Bandhan Bank
The main advantage of trading using opposite Bank of Maharashtra and Bandhan Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Maharashtra position performs unexpectedly, Bandhan Bank 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 Bandhan Bank will offset losses from the drop in Bandhan Bank's long position.| Bank of Maharashtra vs. SBI Life Insurance | Bank of Maharashtra vs. ILFS Investment Managers | Bank of Maharashtra vs. Action Construction Equipment | Bank of Maharashtra vs. Welspun Investments and |
| Bandhan Bank vs. Sarthak Metals Limited | Bandhan Bank vs. Gokul Refoils and | Bandhan Bank vs. NRB Industrial Bearings | Bandhan Bank vs. Lakshmi Finance Industrial |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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