Correlation Between Newgen Software and GM Breweries
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By analyzing existing cross correlation between Newgen Software Technologies and GM Breweries Limited, you can compare the effects of market volatilities on Newgen Software and GM Breweries 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 GM Breweries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newgen Software and GM Breweries.
Diversification Opportunities for Newgen Software and GM Breweries
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Newgen and GMBREW is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Newgen Software Technologies and GM Breweries Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GM Breweries 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 GM Breweries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GM Breweries Limited has no effect on the direction of Newgen Software i.e., Newgen Software and GM Breweries go up and down completely randomly.
Pair Corralation between Newgen Software and GM Breweries
Assuming the 90 days trading horizon Newgen Software Technologies is expected to generate 1.77 times more return on investment than GM Breweries. However, Newgen Software is 1.77 times more volatile than GM Breweries Limited. It trades about 0.08 of its potential returns per unit of risk. GM Breweries Limited is currently generating about 0.06 per unit of risk. If you would invest 31,852 in Newgen Software Technologies on September 4, 2024 and sell it today you would earn a total of 85,808 from holding Newgen Software Technologies or generate 269.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Newgen Software Technologies vs. GM Breweries Limited
Performance |
| Timeline |
| Newgen Software Tech |
| GM Breweries Limited |
Newgen Software and GM Breweries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newgen Software and GM Breweries
The main advantage of trading using opposite Newgen Software and GM Breweries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newgen Software position performs unexpectedly, GM Breweries 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 GM Breweries will offset losses from the drop in GM Breweries' long position.| Newgen Software vs. Indian Metals Ferro | Newgen Software vs. Orient Technologies Limited | Newgen Software vs. Metalyst Forgings Limited | Newgen Software vs. Hisar Metal Industries |
| GM Breweries vs. UFO Moviez India | GM Breweries vs. Nahar Industrial Enterprises | GM Breweries vs. Indian Metals Ferro | GM Breweries vs. Alkali Metals 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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