Correlation Between Marshall Machines and Electronics Mart
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By analyzing existing cross correlation between Marshall Machines Limited and Electronics Mart India, you can compare the effects of market volatilities on Marshall Machines 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 Marshall Machines with a short position of Electronics Mart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marshall Machines and Electronics Mart.
Diversification Opportunities for Marshall Machines and Electronics Mart
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Marshall and Electronics is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Marshall Machines 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 Marshall Machines 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 Marshall Machines 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 Marshall Machines i.e., Marshall Machines and Electronics Mart go up and down completely randomly.
Pair Corralation between Marshall Machines and Electronics Mart
Assuming the 90 days trading horizon Marshall Machines Limited is expected to generate 1.16 times more return on investment than Electronics Mart. However, Marshall Machines is 1.16 times more volatile than Electronics Mart India. It trades about -0.1 of its potential returns per unit of risk. Electronics Mart India is currently generating about -0.34 per unit of risk. If you would invest 2,125 in Marshall Machines Limited on November 20, 2024 and sell it today you would lose (165.00) from holding Marshall Machines Limited or give up 7.76% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Marshall Machines Limited vs. Electronics Mart India
Performance |
Timeline |
Marshall Machines |
Electronics Mart India |
Marshall Machines and Electronics Mart Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Marshall Machines and Electronics Mart
The main advantage of trading using opposite Marshall Machines and Electronics Mart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marshall Machines 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.Marshall Machines vs. Datamatics Global Services | ||
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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