Correlation Between Bank of Maharashtra and Punjab National
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By analyzing existing cross correlation between Bank of Maharashtra and Punjab National Bank, you can compare the effects of market volatilities on Bank of Maharashtra and Punjab National 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 Punjab National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Maharashtra and Punjab National.
Diversification Opportunities for Bank of Maharashtra and Punjab National
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bank and Punjab is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Maharashtra and Punjab National Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Punjab National Bank 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 Punjab National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Punjab National Bank has no effect on the direction of Bank of Maharashtra i.e., Bank of Maharashtra and Punjab National go up and down completely randomly.
Pair Corralation between Bank of Maharashtra and Punjab National
Assuming the 90 days trading horizon Bank of Maharashtra is expected to under-perform the Punjab National. In addition to that, Bank of Maharashtra is 1.12 times more volatile than Punjab National Bank. It trades about -0.01 of its total potential returns per unit of risk. Punjab National Bank is currently generating about 0.02 per unit of volatility. If you would invest 10,872 in Punjab National Bank on September 12, 2024 and sell it today you would earn a total of 175.00 from holding Punjab National Bank or generate 1.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.39% |
| Values | Daily Returns |
Bank of Maharashtra vs. Punjab National Bank
Performance |
| Timeline |
| Bank of Maharashtra |
| Punjab National Bank |
Bank of Maharashtra and Punjab National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Maharashtra and Punjab National
The main advantage of trading using opposite Bank of Maharashtra and Punjab National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Maharashtra position performs unexpectedly, Punjab National 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 Punjab National will offset losses from the drop in Punjab National's long position.| Bank of Maharashtra vs. Reliance Industries Limited | Bank of Maharashtra vs. State Bank of | Bank of Maharashtra vs. Oil Natural Gas | Bank of Maharashtra vs. ICICI Bank Limited |
| Punjab National vs. Reliance Industries Limited | Punjab National vs. State Bank of | Punjab National vs. Oil Natural Gas | Punjab National vs. ICICI Bank Limited |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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