Correlation Between Newgen Software and CSB Bank
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By analyzing existing cross correlation between Newgen Software Technologies and CSB Bank Limited, you can compare the effects of market volatilities on Newgen Software and CSB 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 Newgen Software with a short position of CSB Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newgen Software and CSB Bank.
Diversification Opportunities for Newgen Software and CSB Bank
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Newgen and CSB is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Newgen Software Technologies and CSB Bank Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSB Bank Limited 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 CSB Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSB Bank Limited has no effect on the direction of Newgen Software i.e., Newgen Software and CSB Bank go up and down completely randomly.
Pair Corralation between Newgen Software and CSB Bank
Assuming the 90 days trading horizon Newgen Software Technologies is expected to generate 2.98 times more return on investment than CSB Bank. However, Newgen Software is 2.98 times more volatile than CSB Bank Limited. It trades about 0.1 of its potential returns per unit of risk. CSB Bank Limited is currently generating about 0.03 per unit of risk. If you would invest 20,073 in Newgen Software Technologies on October 13, 2024 and sell it today you would earn a total of 142,587 from holding Newgen Software Technologies or generate 710.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.39% |
| Values | Daily Returns |
Newgen Software Technologies vs. CSB Bank Limited
Performance |
| Timeline |
| Newgen Software Tech |
| CSB Bank Limited |
Newgen Software and CSB Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newgen Software and CSB Bank
The main advantage of trading using opposite Newgen Software and CSB Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newgen Software position performs unexpectedly, CSB 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 CSB Bank will offset losses from the drop in CSB Bank's long position.| Newgen Software vs. Imagicaaworld Entertainment Limited | Newgen Software vs. Network18 Media Investments | Newgen Software vs. Landmark Cars Limited | Newgen Software vs. Cyber Media Research |
| CSB Bank vs. Tera Software Limited | CSB Bank vs. Le Travenues Technology | CSB Bank vs. R S Software | CSB Bank vs. Newgen Software Technologies |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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