Correlation Between POWERGRID Infrastructure and Foods Inns
Specify exactly 2 symbols:
By analyzing existing cross correlation between POWERGRID Infrastructure Investment and Foods Inns Limited, you can compare the effects of market volatilities on POWERGRID Infrastructure and Foods Inns 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 POWERGRID Infrastructure with a short position of Foods Inns. Check out your portfolio center. Please also check ongoing floating volatility patterns of POWERGRID Infrastructure and Foods Inns.
Diversification Opportunities for POWERGRID Infrastructure and Foods Inns
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between POWERGRID and Foods is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding POWERGRID Infrastructure Inves and Foods Inns Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Foods Inns Limited and POWERGRID Infrastructure 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 POWERGRID Infrastructure Investment are associated (or correlated) with Foods Inns. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Foods Inns Limited has no effect on the direction of POWERGRID Infrastructure i.e., POWERGRID Infrastructure and Foods Inns go up and down completely randomly.
Pair Corralation between POWERGRID Infrastructure and Foods Inns
Assuming the 90 days trading horizon POWERGRID Infrastructure Investment is expected to under-perform the Foods Inns. But the stock apears to be less risky and, when comparing its historical volatility, POWERGRID Infrastructure Investment is 3.99 times less risky than Foods Inns. The stock trades about -0.16 of its potential returns per unit of risk. The Foods Inns Limited is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 10,769 in Foods Inns Limited on November 6, 2024 and sell it today you would earn a total of 305.00 from holding Foods Inns Limited or generate 2.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
POWERGRID Infrastructure Inves vs. Foods Inns Limited
Performance |
| Timeline |
| POWERGRID Infrastructure |
| Foods Inns Limited |
POWERGRID Infrastructure and Foods Inns Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with POWERGRID Infrastructure and Foods Inns
The main advantage of trading using opposite POWERGRID Infrastructure and Foods Inns positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if POWERGRID Infrastructure position performs unexpectedly, Foods Inns 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 Foods Inns will offset losses from the drop in Foods Inns' long position.The idea behind POWERGRID Infrastructure Investment and Foods Inns Limited pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Foods Inns vs. Nestle India Limited | Foods Inns vs. Britannia Industries Limited | Foods Inns vs. TATA SUMER PRODUCTS | Foods Inns vs. Patanjali Foods 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |