Correlation Between Bank of Maharashtra and JGCHEMICALS
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By analyzing existing cross correlation between Bank of Maharashtra and JGCHEMICALS LIMITED, you can compare the effects of market volatilities on Bank of Maharashtra and JGCHEMICALS 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 JGCHEMICALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Maharashtra and JGCHEMICALS.
Diversification Opportunities for Bank of Maharashtra and JGCHEMICALS
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and JGCHEMICALS is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Maharashtra and JGCHEMICALS LIMITED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JGCHEMICALS 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 JGCHEMICALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JGCHEMICALS LIMITED has no effect on the direction of Bank of Maharashtra i.e., Bank of Maharashtra and JGCHEMICALS go up and down completely randomly.
Pair Corralation between Bank of Maharashtra and JGCHEMICALS
Assuming the 90 days trading horizon Bank of Maharashtra is expected to generate 2.64 times less return on investment than JGCHEMICALS. But when comparing it to its historical volatility, Bank of Maharashtra is 2.62 times less risky than JGCHEMICALS. It trades about 0.19 of its potential returns per unit of risk. JGCHEMICALS LIMITED is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 35,550 in JGCHEMICALS LIMITED on September 5, 2024 and sell it today you would earn a total of 7,665 from holding JGCHEMICALS LIMITED or generate 21.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of Maharashtra vs. JGCHEMICALS LIMITED
Performance |
| Timeline |
| Bank of Maharashtra |
| JGCHEMICALS LIMITED |
Bank of Maharashtra and JGCHEMICALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Maharashtra and JGCHEMICALS
The main advantage of trading using opposite Bank of Maharashtra and JGCHEMICALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Maharashtra position performs unexpectedly, JGCHEMICALS 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 JGCHEMICALS will offset losses from the drop in JGCHEMICALS's long position.| Bank of Maharashtra vs. Max Financial Services | Bank of Maharashtra vs. Indian Metals Ferro | Bank of Maharashtra vs. Sarthak Metals Limited | Bank of Maharashtra vs. Shyam Metalics and |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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