Correlation Between Prakash Steelage and Federal Bank
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By analyzing existing cross correlation between Prakash Steelage Limited and The Federal Bank, you can compare the effects of market volatilities on Prakash Steelage and Federal Bank 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 Prakash Steelage with a short position of Federal Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prakash Steelage and Federal Bank.
Diversification Opportunities for Prakash Steelage and Federal Bank
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Prakash and Federal is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Prakash Steelage Limited and The Federal Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federal Bank and Prakash Steelage 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 Prakash Steelage Limited are associated (or correlated) with Federal Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federal Bank has no effect on the direction of Prakash Steelage i.e., Prakash Steelage and Federal Bank go up and down completely randomly.
Pair Corralation between Prakash Steelage and Federal Bank
Assuming the 90 days trading horizon Prakash Steelage Limited is expected to generate 1.79 times more return on investment than Federal Bank. However, Prakash Steelage is 1.79 times more volatile than The Federal Bank. It trades about 0.05 of its potential returns per unit of risk. The Federal Bank is currently generating about 0.09 per unit of risk. If you would invest 700.00 in Prakash Steelage Limited on September 12, 2024 and sell it today you would earn a total of 203.00 from holding Prakash Steelage Limited or generate 29.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.59% |
| Values | Daily Returns |
Prakash Steelage Limited vs. The Federal Bank
Performance |
| Timeline |
| Prakash Steelage |
| Federal Bank |
Prakash Steelage and Federal Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prakash Steelage and Federal Bank
The main advantage of trading using opposite Prakash Steelage and Federal Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prakash Steelage position performs unexpectedly, Federal Bank 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 Federal Bank will offset losses from the drop in Federal Bank's long position.| Prakash Steelage vs. Steel Authority of | Prakash Steelage vs. Embassy Office Parks | Prakash Steelage vs. Indian Metals Ferro | Prakash Steelage vs. JTL Industries |
| Federal Bank vs. Yes Bank Limited | Federal Bank vs. Indian Oil | Federal Bank vs. Indo Borax Chemicals | Federal Bank vs. Kingfa Science Technology |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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