Correlation Between Persistent Systems and Orient Technologies
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By analyzing existing cross correlation between Persistent Systems Limited and Orient Technologies Limited, you can compare the effects of market volatilities on Persistent Systems and Orient Technologies 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 Persistent Systems with a short position of Orient Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Persistent Systems and Orient Technologies.
Diversification Opportunities for Persistent Systems and Orient Technologies
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Persistent and Orient is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Persistent Systems Limited and Orient Technologies Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orient Technologies and Persistent Systems 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 Persistent Systems Limited are associated (or correlated) with Orient Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orient Technologies has no effect on the direction of Persistent Systems i.e., Persistent Systems and Orient Technologies go up and down completely randomly.
Pair Corralation between Persistent Systems and Orient Technologies
Assuming the 90 days trading horizon Persistent Systems is expected to generate 2.59 times less return on investment than Orient Technologies. But when comparing it to its historical volatility, Persistent Systems Limited is 3.62 times less risky than Orient Technologies. It trades about 0.32 of its potential returns per unit of risk. Orient Technologies Limited is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 31,412 in Orient Technologies Limited on September 3, 2024 and sell it today you would earn a total of 8,433 from holding Orient Technologies Limited or generate 26.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Persistent Systems Limited vs. Orient Technologies Limited
Performance |
| Timeline |
| Persistent Systems |
| Orient Technologies |
Persistent Systems and Orient Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Persistent Systems and Orient Technologies
The main advantage of trading using opposite Persistent Systems and Orient Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Persistent Systems position performs unexpectedly, Orient Technologies 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 Orient Technologies will offset losses from the drop in Orient Technologies' long position.| Persistent Systems vs. Kamat Hotels Limited | Persistent Systems vs. MIRC Electronics Limited | Persistent Systems vs. Fino Payments Bank | Persistent Systems vs. Bandhan Bank Limited |
| Orient Technologies vs. Tata Consultancy Services | Orient Technologies vs. Infosys Limited | Orient Technologies vs. Wipro Limited | Orient Technologies vs. Persistent Systems 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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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