Correlation Between MRF and Parag Milk
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By analyzing existing cross correlation between MRF Limited and Parag Milk Foods, you can compare the effects of market volatilities on MRF and Parag Milk 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 Parag Milk. Check out your portfolio center. Please also check ongoing floating volatility patterns of MRF and Parag Milk.
Diversification Opportunities for MRF and Parag Milk
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MRF and Parag is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding MRF Limited and Parag Milk Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Parag Milk Foods 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 Parag Milk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Parag Milk Foods has no effect on the direction of MRF i.e., MRF and Parag Milk go up and down completely randomly.
Pair Corralation between MRF and Parag Milk
Assuming the 90 days trading horizon MRF is expected to generate 2.51 times less return on investment than Parag Milk. But when comparing it to its historical volatility, MRF Limited is 2.42 times less risky than Parag Milk. It trades about 0.06 of its potential returns per unit of risk. Parag Milk Foods is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 10,547 in Parag Milk Foods on September 2, 2024 and sell it today you would earn a total of 10,164 from holding Parag Milk Foods or generate 96.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MRF Limited vs. Parag Milk Foods
Performance |
| Timeline |
| MRF Limited |
| Parag Milk Foods |
MRF and Parag Milk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MRF and Parag Milk
The main advantage of trading using opposite MRF and Parag Milk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MRF position performs unexpectedly, Parag Milk 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 Parag Milk will offset losses from the drop in Parag Milk's long position.| MRF vs. Apollo Sindoori Hotels | MRF vs. Baazar Style Retail | MRF vs. Lemon Tree Hotels | MRF vs. Kamat Hotels Limited |
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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