Correlation Between Pritish Nandy and Indraprastha Medical

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Can any of the company-specific risk be diversified away by investing in both Pritish Nandy and Indraprastha Medical at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Pritish Nandy and Indraprastha Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pritish Nandy Communications and Indraprastha Medical, you can compare the effects of market volatilities on Pritish Nandy and Indraprastha Medical 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 Pritish Nandy with a short position of Indraprastha Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pritish Nandy and Indraprastha Medical.

Diversification Opportunities for Pritish Nandy and Indraprastha Medical

0.29
  Correlation Coefficient

Modest diversification

The 3 months correlation between Pritish and Indraprastha is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Pritish Nandy Communications and Indraprastha Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indraprastha Medical and Pritish Nandy 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 Pritish Nandy Communications are associated (or correlated) with Indraprastha Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indraprastha Medical has no effect on the direction of Pritish Nandy i.e., Pritish Nandy and Indraprastha Medical go up and down completely randomly.

Pair Corralation between Pritish Nandy and Indraprastha Medical

Assuming the 90 days trading horizon Pritish Nandy is expected to generate 2.61 times less return on investment than Indraprastha Medical. In addition to that, Pritish Nandy is 1.22 times more volatile than Indraprastha Medical. It trades about 0.04 of its total potential returns per unit of risk. Indraprastha Medical is currently generating about 0.13 per unit of volatility. If you would invest  8,063  in Indraprastha Medical on August 30, 2024 and sell it today you would earn a total of  35,677  from holding Indraprastha Medical or generate 442.48% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy99.59%
ValuesDaily Returns

Pritish Nandy Communications  vs.  Indraprastha Medical

 Performance 
       Timeline  
Pritish Nandy Commun 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Pritish Nandy Communications has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Pritish Nandy is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.
Indraprastha Medical 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Indraprastha Medical are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting fundamental indicators, Indraprastha Medical exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pritish Nandy and Indraprastha Medical Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Pritish Nandy and Indraprastha Medical

The main advantage of trading using opposite Pritish Nandy and Indraprastha Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pritish Nandy position performs unexpectedly, Indraprastha Medical 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 Indraprastha Medical will offset losses from the drop in Indraprastha Medical's long position.
The idea behind Pritish Nandy Communications and Indraprastha Medical 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.
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.

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