Correlation Between Newgen Software and Capacite Infraprojects
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By analyzing existing cross correlation between Newgen Software Technologies and Capacite Infraprojects Limited, you can compare the effects of market volatilities on Newgen Software and Capacite Infraprojects 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 Newgen Software with a short position of Capacite Infraprojects. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newgen Software and Capacite Infraprojects.
Diversification Opportunities for Newgen Software and Capacite Infraprojects
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Newgen and Capacite is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Newgen Software Technologies and Capacite Infraprojects Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capacite Infraprojects and Newgen Software 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 Newgen Software Technologies are associated (or correlated) with Capacite Infraprojects. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capacite Infraprojects has no effect on the direction of Newgen Software i.e., Newgen Software and Capacite Infraprojects go up and down completely randomly.
Pair Corralation between Newgen Software and Capacite Infraprojects
Assuming the 90 days trading horizon Newgen Software Technologies is expected to generate 1.66 times more return on investment than Capacite Infraprojects. However, Newgen Software is 1.66 times more volatile than Capacite Infraprojects Limited. It trades about 0.6 of its potential returns per unit of risk. Capacite Infraprojects Limited is currently generating about 0.05 per unit of risk. If you would invest 117,660 in Newgen Software Technologies on October 1, 2024 and sell it today you would earn a total of 44,505 from holding Newgen Software Technologies or generate 37.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Newgen Software Technologies vs. Capacite Infraprojects Limited
Performance |
| Timeline |
| Newgen Software Tech |
| Capacite Infraprojects |
Newgen Software and Capacite Infraprojects Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newgen Software and Capacite Infraprojects
The main advantage of trading using opposite Newgen Software and Capacite Infraprojects positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newgen Software position performs unexpectedly, Capacite Infraprojects 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 Capacite Infraprojects will offset losses from the drop in Capacite Infraprojects' long position.| Newgen Software vs. Kingfa Science Technology | Newgen Software vs. Rico Auto Industries | Newgen Software vs. GACM Technologies Limited | Newgen Software vs. COSMO FIRST LIMITED |
| Capacite Infraprojects vs. MRF Limited | Capacite Infraprojects vs. JSW Holdings Limited | Capacite Infraprojects vs. Maharashtra Scooters Limited | Capacite Infraprojects vs. Nalwa Sons Investments |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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