Correlation Between National Foods and Supernet
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By analyzing existing cross correlation between National Foods and Supernet, you can compare the effects of market volatilities on National Foods and Supernet 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 National Foods with a short position of Supernet. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Foods and Supernet.
Diversification Opportunities for National Foods and Supernet
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between National and Supernet is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding National Foods and Supernet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Supernet and National 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 National Foods are associated (or correlated) with Supernet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Supernet has no effect on the direction of National Foods i.e., National Foods and Supernet go up and down completely randomly.
Pair Corralation between National Foods and Supernet
Assuming the 90 days trading horizon National Foods is expected to generate 1.96 times less return on investment than Supernet. But when comparing it to its historical volatility, National Foods is 2.89 times less risky than Supernet. It trades about 0.29 of its potential returns per unit of risk. Supernet is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,275 in Supernet on September 13, 2024 and sell it today you would earn a total of 321.00 from holding Supernet or generate 25.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
National Foods vs. Supernet
Performance |
| Timeline |
| National Foods |
| Supernet |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
National Foods and Supernet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Foods and Supernet
The main advantage of trading using opposite National Foods and Supernet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Foods position performs unexpectedly, Supernet 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 Supernet will offset losses from the drop in Supernet's long position.| National Foods vs. Masood Textile Mills | National Foods vs. Fauji Foods | National Foods vs. KSB Pumps | National Foods vs. Mari Petroleum |
| Supernet vs. Atlas Insurance | Supernet vs. Sindh Modaraba Management | Supernet vs. Jubilee Life Insurance | Supernet vs. Premier Insurance |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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