Correlation Between Punjab National and Swan Energy
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By analyzing existing cross correlation between Punjab National Bank and Swan Energy Limited, you can compare the effects of market volatilities on Punjab National and Swan Energy 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 Swan Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Punjab National and Swan Energy.
Diversification Opportunities for Punjab National and Swan Energy
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Punjab and Swan is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Punjab National Bank and Swan Energy Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swan Energy Limited 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 Swan Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swan Energy Limited has no effect on the direction of Punjab National i.e., Punjab National and Swan Energy go up and down completely randomly.
Pair Corralation between Punjab National and Swan Energy
Assuming the 90 days trading horizon Punjab National is expected to generate 7.56 times less return on investment than Swan Energy. But when comparing it to its historical volatility, Punjab National Bank is 2.1 times less risky than Swan Energy. It trades about 0.12 of its potential returns per unit of risk. Swan Energy Limited is currently generating about 0.42 of returns per unit of risk over similar time horizon. If you would invest 53,625 in Swan Energy Limited on September 13, 2024 and sell it today you would earn a total of 24,415 from holding Swan Energy Limited or generate 45.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Punjab National Bank vs. Swan Energy Limited
Performance |
| Timeline |
| Punjab National Bank |
| Swan Energy Limited |
Punjab National and Swan Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Punjab National and Swan Energy
The main advantage of trading using opposite Punjab National and Swan Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Punjab National position performs unexpectedly, Swan Energy 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 Swan Energy will offset losses from the drop in Swan Energy's long position.| Punjab National vs. Reliance Industries Limited | Punjab National vs. State Bank of | Punjab National vs. Oil Natural Gas | Punjab National vs. ICICI Bank Limited |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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