Correlation Between Power Finance and Home First
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By analyzing existing cross correlation between Power Finance and Home First Finance, you can compare the effects of market volatilities on Power Finance and Home First 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 Power Finance with a short position of Home First. Check out your portfolio center. Please also check ongoing floating volatility patterns of Power Finance and Home First.
Diversification Opportunities for Power Finance and Home First
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Power and Home is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Power Finance and Home First Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Home First Finance and Power Finance 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 Power Finance are associated (or correlated) with Home First. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Home First Finance has no effect on the direction of Power Finance i.e., Power Finance and Home First go up and down completely randomly.
Pair Corralation between Power Finance and Home First
Assuming the 90 days trading horizon Power Finance is expected to under-perform the Home First. In addition to that, Power Finance is 1.04 times more volatile than Home First Finance. It trades about -0.24 of its total potential returns per unit of risk. Home First Finance is currently generating about -0.05 per unit of volatility. If you would invest 105,215 in Home First Finance on September 30, 2024 and sell it today you would lose (2,225) from holding Home First Finance or give up 2.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Power Finance vs. Home First Finance
Performance |
| Timeline |
| Power Finance |
| Home First Finance |
Power Finance and Home First Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Power Finance and Home First
The main advantage of trading using opposite Power Finance and Home First positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Power Finance position performs unexpectedly, Home First 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 Home First will offset losses from the drop in Home First's long position.| Power Finance vs. Kingfa Science Technology | Power Finance vs. Rico Auto Industries | Power Finance vs. GACM Technologies Limited | Power Finance vs. COSMO FIRST LIMITED |
| Home First vs. Reliance Industries Limited | Home First vs. Oil Natural Gas | Home First vs. Power Finance | Home First vs. Indian Oil |
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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