Correlation Between Punjab National and State Trading
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By analyzing existing cross correlation between Punjab National Bank and The State Trading, you can compare the effects of market volatilities on Punjab National and State Trading 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 Punjab National with a short position of State Trading. Check out your portfolio center. Please also check ongoing floating volatility patterns of Punjab National and State Trading.
Diversification Opportunities for Punjab National and State Trading
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Punjab and State is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Punjab National Bank and The State Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Trading and Punjab National 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 Punjab National Bank are associated (or correlated) with State Trading. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Trading has no effect on the direction of Punjab National i.e., Punjab National and State Trading go up and down completely randomly.
Pair Corralation between Punjab National and State Trading
Assuming the 90 days trading horizon Punjab National Bank is expected to generate 0.62 times more return on investment than State Trading. However, Punjab National Bank is 1.62 times less risky than State Trading. It trades about 0.06 of its potential returns per unit of risk. The State Trading is currently generating about 0.04 per unit of risk. If you would invest 5,381 in Punjab National Bank on August 24, 2024 and sell it today you would earn a total of 4,256 from holding Punjab National Bank or generate 79.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.39% |
| Values | Daily Returns |
Punjab National Bank vs. The State Trading
Performance |
| Timeline |
| Punjab National Bank |
| State Trading |
Punjab National and State Trading Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Punjab National and State Trading
The main advantage of trading using opposite Punjab National and State Trading positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Punjab National position performs unexpectedly, State Trading 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 State Trading will offset losses from the drop in State Trading's long position.| Punjab National vs. MRF Limited | Punjab National vs. Honeywell Automation India | Punjab National vs. Divis Laboratories Limited | Punjab National vs. Indo Borax Chemicals |
| State Trading vs. Reliance Industries Limited | State Trading vs. Life Insurance | State Trading vs. Indian Oil | State Trading vs. Oil Natural Gas |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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