Correlation Between Patanjali Foods and GM Breweries
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By analyzing existing cross correlation between Patanjali Foods Limited and GM Breweries Limited, you can compare the effects of market volatilities on Patanjali Foods 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 Patanjali Foods with a short position of GM Breweries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Patanjali Foods and GM Breweries.
Diversification Opportunities for Patanjali Foods and GM Breweries
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Patanjali and GMBREW is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Patanjali Foods Limited 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 Patanjali 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 Patanjali Foods Limited 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 Patanjali Foods i.e., Patanjali Foods and GM Breweries go up and down completely randomly.
Pair Corralation between Patanjali Foods and GM Breweries
Assuming the 90 days trading horizon Patanjali Foods Limited is expected to generate 0.62 times more return on investment than GM Breweries. However, Patanjali Foods Limited is 1.6 times less risky than GM Breweries. It trades about 0.13 of its potential returns per unit of risk. GM Breweries Limited is currently generating about -0.18 per unit of risk. If you would invest 174,855 in Patanjali Foods Limited on October 28, 2024 and sell it today you would earn a total of 6,815 from holding Patanjali Foods Limited or generate 3.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Patanjali Foods Limited vs. GM Breweries Limited
Performance |
| Timeline |
| Patanjali Foods |
| GM Breweries Limited |
Patanjali Foods and GM Breweries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Patanjali Foods and GM Breweries
The main advantage of trading using opposite Patanjali Foods and GM Breweries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Patanjali Foods 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.| Patanjali Foods vs. Kilitch Drugs Limited | Patanjali Foods vs. Southern Petrochemicals Industries | Patanjali Foods vs. Rashtriya Chemicals and | Patanjali Foods vs. General Insurance |
| GM Breweries vs. ILFS Investment Managers | GM Breweries vs. Network18 Media Investments | GM Breweries vs. Kalyani Investment | GM Breweries vs. Touchwood Entertainment 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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