Correlation Between MIC Electronics and State Bank
Can any of the company-specific risk be diversified away by investing in both MIC Electronics and State Bank at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining MIC Electronics and State Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MIC Electronics Limited and State Bank of, you can compare the effects of market volatilities on MIC Electronics and State 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 MIC Electronics with a short position of State Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of MIC Electronics and State Bank.
Diversification Opportunities for MIC Electronics and State Bank
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between MIC and State is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding MIC Electronics Limited and State Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Bank and MIC Electronics 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 MIC Electronics Limited are associated (or correlated) with State Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Bank has no effect on the direction of MIC Electronics i.e., MIC Electronics and State Bank go up and down completely randomly.
Pair Corralation between MIC Electronics and State Bank
Assuming the 90 days trading horizon MIC Electronics Limited is expected to generate 2.07 times more return on investment than State Bank. However, MIC Electronics is 2.07 times more volatile than State Bank of. It trades about -0.23 of its potential returns per unit of risk. State Bank of is currently generating about -0.6 per unit of risk. If you would invest 9,278 in MIC Electronics Limited on October 11, 2024 and sell it today you would lose (958.00) from holding MIC Electronics Limited or give up 10.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MIC Electronics Limited vs. State Bank of
Performance |
| Timeline |
| MIC Electronics |
| State Bank |
MIC Electronics and State Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MIC Electronics and State Bank
The main advantage of trading using opposite MIC Electronics and State Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MIC Electronics position performs unexpectedly, State 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 State Bank will offset losses from the drop in State Bank's long position.| MIC Electronics vs. Radaan Mediaworks India | MIC Electronics vs. Network18 Media Investments | MIC Electronics vs. Silly Monks Entertainment | MIC Electronics vs. Coffee Day Enterprises |
| State Bank vs. MIC Electronics Limited | State Bank vs. Network18 Media Investments | State Bank vs. POWERGRID Infrastructure Investment | State Bank vs. Dhunseri Investments 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |