Correlation Between MRF and Bajaj Healthcare
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By analyzing existing cross correlation between MRF Limited and Bajaj Healthcare Limited, you can compare the effects of market volatilities on MRF and Bajaj Healthcare 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 MRF with a short position of Bajaj Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of MRF and Bajaj Healthcare.
Diversification Opportunities for MRF and Bajaj Healthcare
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between MRF and Bajaj is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding MRF Limited and Bajaj Healthcare Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bajaj Healthcare and MRF 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 MRF Limited are associated (or correlated) with Bajaj Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bajaj Healthcare has no effect on the direction of MRF i.e., MRF and Bajaj Healthcare go up and down completely randomly.
Pair Corralation between MRF and Bajaj Healthcare
Assuming the 90 days trading horizon MRF Limited is expected to under-perform the Bajaj Healthcare. But the stock apears to be less risky and, when comparing its historical volatility, MRF Limited is 1.9 times less risky than Bajaj Healthcare. The stock trades about -0.01 of its potential returns per unit of risk. The Bajaj Healthcare Limited is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 37,186 in Bajaj Healthcare Limited on September 3, 2024 and sell it today you would earn a total of 2,549 from holding Bajaj Healthcare Limited or generate 6.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.55% |
| Values | Daily Returns |
MRF Limited vs. Bajaj Healthcare Limited
Performance |
| Timeline |
| MRF Limited |
| Bajaj Healthcare |
MRF and Bajaj Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MRF and Bajaj Healthcare
The main advantage of trading using opposite MRF and Bajaj Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MRF position performs unexpectedly, Bajaj Healthcare 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 Bajaj Healthcare will offset losses from the drop in Bajaj Healthcare's long position.| MRF vs. Bajaj Holdings Investment | MRF vs. Shipping | MRF vs. Indo Borax Chemicals | MRF vs. Kingfa Science Technology |
| Bajaj Healthcare vs. Life Insurance | Bajaj Healthcare vs. Ortel Communications Limited | Bajaj Healthcare vs. Electronics Mart India | Bajaj Healthcare vs. Sonata Software 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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