Correlation Between Prakash Steelage and GACM Technologies
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By analyzing existing cross correlation between Prakash Steelage Limited and GACM Technologies Limited, you can compare the effects of market volatilities on Prakash Steelage and GACM Technologies 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 GACM Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prakash Steelage and GACM Technologies.
Diversification Opportunities for Prakash Steelage and GACM Technologies
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Prakash and GACM is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Prakash Steelage Limited and GACM Technologies Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GACM Technologies 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 GACM Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GACM Technologies has no effect on the direction of Prakash Steelage i.e., Prakash Steelage and GACM Technologies go up and down completely randomly.
Pair Corralation between Prakash Steelage and GACM Technologies
Assuming the 90 days trading horizon Prakash Steelage Limited is expected to generate 0.97 times more return on investment than GACM Technologies. However, Prakash Steelage Limited is 1.03 times less risky than GACM Technologies. It trades about 0.05 of its potential returns per unit of risk. GACM Technologies Limited is currently generating about -0.2 per unit of risk. If you would invest 485.00 in Prakash Steelage Limited on October 11, 2024 and sell it today you would earn a total of 307.00 from holding Prakash Steelage Limited or generate 63.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 75.98% |
| Values | Daily Returns |
Prakash Steelage Limited vs. GACM Technologies Limited
Performance |
| Timeline |
| Prakash Steelage |
| GACM Technologies |
Prakash Steelage and GACM Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prakash Steelage and GACM Technologies
The main advantage of trading using opposite Prakash Steelage and GACM Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prakash Steelage position performs unexpectedly, GACM Technologies 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 GACM Technologies will offset losses from the drop in GACM Technologies' long position.| Prakash Steelage vs. Thirumalai Chemicals Limited | Prakash Steelage vs. Sudarshan Chemical Industries | Prakash Steelage vs. Yatra Online Limited | Prakash Steelage vs. Vishnu Chemicals Limited |
| GACM Technologies vs. Golden Tobacco Limited | GACM Technologies vs. SAL Steel Limited | GACM Technologies vs. Prakash Steelage Limited | GACM Technologies vs. Mahamaya Steel Industries |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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