Correlation Between Megastar Foods and Newgen Software
Specify exactly 2 symbols:
By analyzing existing cross correlation between Megastar Foods Limited and Newgen Software Technologies, you can compare the effects of market volatilities on Megastar Foods and Newgen Software 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 Megastar Foods with a short position of Newgen Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Megastar Foods and Newgen Software.
Diversification Opportunities for Megastar Foods and Newgen Software
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Megastar and Newgen is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Megastar Foods Limited and Newgen Software Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newgen Software Tech and Megastar 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 Megastar Foods Limited are associated (or correlated) with Newgen Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Newgen Software Tech has no effect on the direction of Megastar Foods i.e., Megastar Foods and Newgen Software go up and down completely randomly.
Pair Corralation between Megastar Foods and Newgen Software
Assuming the 90 days trading horizon Megastar Foods Limited is expected to under-perform the Newgen Software. But the stock apears to be less risky and, when comparing its historical volatility, Megastar Foods Limited is 1.18 times less risky than Newgen Software. The stock trades about -0.04 of its potential returns per unit of risk. The Newgen Software Technologies is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 70,640 in Newgen Software Technologies on November 5, 2024 and sell it today you would earn a total of 34,175 from holding Newgen Software Technologies or generate 48.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.3% |
| Values | Daily Returns |
Megastar Foods Limited vs. Newgen Software Technologies
Performance |
| Timeline |
| Megastar Foods |
| Newgen Software Tech |
Megastar Foods and Newgen Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Megastar Foods and Newgen Software
The main advantage of trading using opposite Megastar Foods and Newgen Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Megastar Foods position performs unexpectedly, Newgen Software 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 Newgen Software will offset losses from the drop in Newgen Software's long position.| Megastar Foods vs. Reliance Industries Limited | Megastar Foods vs. Tata Motors Limited | Megastar Foods vs. Oil Natural Gas | Megastar Foods vs. HCL Technologies Limited |
| Newgen Software vs. Embassy Office Parks | Newgen Software vs. Agarwal Industrial | Newgen Software vs. Popular Vehicles and | Newgen Software vs. Sarthak Metals 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |